Vehicle enthusiasts may have to wait for fully autonomous vehicles to appear at their favorite Ford dealer locations. Ford Motor Company planned to disband the autonomous vehicle company Argo AI at the end of October.
No Clear Path to Profitability for Ford
Ford’s leadership does not believe that there is a clear path to profitability. Instead, Ford wants to continue to focus on semi-automated driver-assist systems.
According to Chief Financial Officer John Lawler, “we’ve looked at this every way that you can. We just see the profitability, given the investment that’s going to be required a long way out.” Ford believes that it would take billions of dollars to put completely self-driving vehicles on the road. This move by Ford shows how difficult and expensive it will cost to bring self-driving cars a reality, especially after huge investments haven’t produced any major tangible results.
Many expect that it will take a massive consolidation in the industry to make autonomous vehicles a profitable enterprise. Until several major players combine their resources, smaller companies will go under or be absorbed by larger organizations.
Growth Despite Loss
The move to disband Argo AI is going to cost Ford a reported net loss of nearly $827 million, including writing off a cash investment of about $500 million. Ford and its partner Volkswagen are hiring most of the 2,000 Argo employees.
Despite this large loss, Ford ended the most recent quarter with $32 billion in cash and $49 billion in total liquidity. Ford actually beat Wall Street estimates by about $2 billion in revenue. That’s not bad, considering the last couple of years have put a strain on the auto industry.
You may have noticed that there weren’t quite as few new models available at your local Ford dealer over the last two years. That’s mainly because of a massive production slowdown due to the COVID-19 pandemic, labor shortages, and supply-line delays. The fact that Ford expects to earn pretax earnings of around $11.5 billion is still pretty impressive.
What About Ford BlueCruise Technology?
While you won’t find any fully autonomous vehicles at your favorite Ford dealer anytime soon, you can still enjoy its semi-autonomous BlueCruise technology on future vehicles.
BlueCruise is similar to GM’s Super Cruise systems. Ford has already mapped 100,000 miles of qualified roadways, called “hands-free blue zones.” When the conditions are right on the road, drivers can activate BlueCruise to allow the vehicle to take over driving.
BlueCruise is not completely autonomous. Drivers must remain alert and ready to take the wheel at any time. This system is not able to take evasive action if there is a small obstacle in the road. BlueCruise implements a head and eye position sensor that makes sure you are watching the road when the system is active.
Currently, BlueCruise is only available on the Ford Mustang Mach-E and certain models of the Ford F-150, but you can expect more options at your Ford dealer of choice to carry this system.
In the meantime, drivers will have to keep waiting for a huge breakthrough before they can count on a fully self-driving car to hit the market, let alone a local Ford dealer.
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