Robo-taxis are coming – from suppliers, too

FRANKFURT — It's no surprise these days to hear the CEO of an automaker talk about building a fleet of autonomous robo-taxis to move people around congested urban centers. Daimler, Renault-Nissan, General Motors and Ford Motor Co. all have said they are working on self-driving vehicles for ride-hailing services.

Now, Tier 1 suppliers are flexing their muscles in the robo-taxi world, with Continental even building an autonomous shuttle to move workers around the German giant's sprawling campus here. The CUbE — a rectangular block of a vehicle — runs on electric motors and arrives on command from a smartphone app. Trials began this year.

But Continental isn't eyeing a future where it produces fleets of the CUbE shuttle for customers.

"We are not an OEM — we don't want to be an OEM," said Alfred Eckert, director of advanced technology in Continental's chassis and safety division.

Instead, Continental's investment in the robo-taxi space is about opportunity. Autonomous-driving technology is about to explode in growth, and suppliers aim to grab a significant chunk of the business. Experiments in self-driving technology are rolling out at a rapid pace. Automakers and suppliers are teaming up in new collaborations. The flurry of investment suggests that these companies believe the day a self-driving pod shows up on a consumer's doorstep for a trip to the airport is fast approaching.

Continental executives say supplying autonomous technology has huge market potential.

"Radar and camera systems, evaluation electronics, driver-assistance systems — we are growing fast with solutions for assisted driving and are paving the way for automated driving," Continental CEO Elmar Degenhart said at the Frankfurt auto show in September. He had just shown reporters a video of him taking the CUbE shuttle across Continental's campus.

That potential has Continental making serious investments to position itself for the growth. In July, Continental bought a minority stake in French autonomous driving company EasyMile. Continental's CUbE test vehicle is based on an EasyMile shuttle. In 2016, Continental acquired the lidar business of California company Advanced Scientific Concepts Inc.

"By 2025, we expect a global market for automated-driving technology that is worth more than $35 billion — twice as much as for 2020," Degenhart said. "Our share of the market for assisted driving alone is already around 15 percent. We see more clear potential here."

Many of the industry's top suppliers are jumping on board. Delphi — which plans to spin off its self-driving technology business into a company called Aptiv next year — is experimenting with an autonomous commercial taxi service in France and Singapore. This year, Robert Bosch said it will work with Daimler on a self-driving car partnership focused on speeding the production of robo-taxis.

Collaboration seems to be a key principle of autonomous driving advancement. In addition to the Daimler-Bosch tie-up, BMW is forging its own partnerships to develop an autonomous driving platform to be the foundation of its iNEXT vehicle planned for 2021. Continental and Delphi joined the BMW collaboration this year.

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