Self-driving cars
Spinning off
Uber is selling its supposedly vital autonomous-vehicle division
Dec 12th 2020 | words 443
IN 2016 TRAVIS KALANICK, then Ubers chief executive, described self-driving cars as mission-critical. If somebody managed to beat Uber to making them work, he said, then the rivals ability to offer taxi trips without paying for human drivers would mean that Uber is no longer a thing.
Times change. On December 7th Uber announced the sale of its self-driving arm to a firm called Aurora. No price was given. But Uber said it would put another $400m into the unit; that Dara Khosrowshahi, its current boss, would join Auroras board; and that the deal would leave it with a 26% stake in Aurora.
One reason for the spin-off is Ubers belated effort to return to profit. It lost $8.5bn in 2019, as it fought for market share with rivals such as Lyft. Besides offloading the self-driving unit, the firm has sacked workers and sold its Jump electric-bicycle division to Lime, a scooter firm. On December 8th Uber said it would flog its Elevate flying-car project to a startup called Joby Aviation.
Another explanation is that the reality of self-driving has lagged far behind the excitement, as it had done in the ideas earlier heydays in the 1960s and the 1990s. The machine-learning software on which the cars rely often struggles to cope with edge cases, which are absent from softwares training data but pop up regularly on real roads.
Ubers self-driving progress has, according to industry rumours, been slow. In 2018 one of its cars ran over and killed a pedestrian in Arizona. It is not alone; Teslas Autopilot feature has been linked to at least four deaths since it was launched in 2015. But Ubers Kalanick-era reputation for rule-breaking has made the PR burden heavier.
The bearish interpretation of the sale is that, having given up on self-driving, Uber will remain a fancy taxi-and-delivery firm. But if Aurora can buck expectations and make self-driving work, Uber could license the technology back. And high-tech distractions like self-driving carsor flying onesmay be the last thing the firm needs. It is under pressure not just from rivals and investors but also from regulatory probes into its other big cost-saving innovationthe assertion that its drivers are not employees, but independent contractors. Joe Biden, Americas president-elect, has called that a misclassification. Tighter European rules will come into force by 2022. Those edge cases look urgent.
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