Intel is buying Jerusalem tech giant Mobileye for $15.3 billion, the two companies announced Monday. Israeli daily Haaretz initially broke the story via its finance paper The Marker, but it was confirmed later in the day. Mobileye’s current market value is $10.5 billion. Intel has been working with Mobileye and BMW to get their own self-driving car models on the road, joining a host of manufacturers in a global autonomous vehicle race.”
“This acquisition is a great step forward for our shareholders, the automotive industry and consumers,” said Brian Krzanich, Intel CEO, in a press release. “Intel provides critical foundational technologies for autonomous driving including plotting the car’s path and making real-time driving decisions. Mobileye brings the industry’s best automotive-grade computer vision and strong momentum with automakers and suppliers. Together, we can accelerate the future of autonomous driving with improved performance in a cloud-to-car solution at a lower cost for automakers.”
Mobileye and Intel’s Automated Driving Group will now merge and headquarter their operations in Israel under the auspices of Mobileye Co-Founder, Chairman and CTO Professor Amnon Shashua. The two companies did not specify where the joint operation will be located, but given that both companies maintain national headquarters in Jerusalem it will likely be in the holy city.
Mobileye has become a quintessential element of the global technology economy since going public several years ago. The company has taken major strides into the self-driving car race. Recently ending a partnership with Tesla, they announced a deal with Delphi last August to help the latter build their own autonomous vehicle model.
“We expect the growth towards autonomous driving to be transformative. It will provide consumers with safer, more flexible, and less costly transportation options, and provide incremental business model opportunities for our automaker customers,” Mobileye Co-Founder, CEO, and President Ziv Aviram wrote in the official announcement. “By pooling together our infrastructure and resources, we can enhance and accelerate our combined know-how in the areas of mapping, virtual driving, simulators, development tool chains, hardware, data centers and high-performance computing platforms. Together, we will provide an attractive value proposition for the automotive industry.”
“The Mobileye and Delphi relationship started in 2002 with the implementation of what was one of the most advanced active safety systems of the time. Our long history together is key to the success of this ambitious endeavor,” Professor Amnon Shashua, Mobileye Co-Founder, Chairman and CTO, said upon announcing the partnership last year.
BMW had announced a tripartite deal with Mobileye and Intel to develop a fully autonomous car by 2021, but expedited that timeline in an announcement last December that foresaw BMW self-driving cars being tested in Munich this year. Intel clarified at CES that test would include 40 vehicles.
Such a massive investment could only be justified if Intel sees a way to dominate a large chunk of the autonomous vehicle market.
“This year our fleet of vehicles will already test this joint technology globally under real traffic conditions,” Klaus Fröhlich, Member of the Board of Management of BMW AG for Development, wrote in January. “This is a significant step towards the introduction of the BMW iNEXT in 2021, which will be the BMW Group’s first fully autonomous vehicle.”
This article has been updated with official statements from Intel and Mobileye.