The Electric: Will Assisted Driving Tech Give Detroit a Stock Boost? Don’t Bet on It

In March 2017, Mark Fields, then CEO of Ford, announced one of the most surprising gambles in company history—a $1 billion investment in Argo AI, a little-known Pittsburgh startup that promised to help Ford produce a driverless car by 2021. Though Ford wasn’t prone to betting on unproven startups, Fields suggested he had little choice: By the end of the 2020s, he foresaw the convenience and thrill of driving hands-free sweeping away traditional vehicles. But Fields wasn’t thinking only of survival: Ford and much of Detroit also thought that driverless technology fueled by artificial intelligence could transform the major automakers from stodgy manufacturers with low stock valuations and profit margins into tech-infused sensations meriting Silicon Valley valuations. 

Three months ago, Fields’ successor, current Ford CEO Jim Farley, pulled the plug on Argo and with it the company’s goal—at least for the foreseeable future—of producing driverless cars. After some $2.7 billion in spending by Ford, Argo hadn’t produced reliable driverless technology, convincing Farley that fully autonomous cars were “a long way off.” Instead, he said, the future would be in advanced driver assistance systems—souped-up cruise control, such as Ford’s BlueCruise, that would allow motorists to drive hands-free on designated highways. In a June speech Farley said ADAS could itself be transformational and generate “tens of thousands of dollars” in subscription revenue over the life of a car. “We’re about to change the ride, just like Apple and all the smartphone companies changed the call,” he said.