Motional Flies Solo After Aptiv’s Curtain Call
The former joint venture between Hyundai and Aptiv will be solely owned by Hyundai and its various subsidiaries. This comes after Aptiv’s January 2024’s announcement of exiting the self-driving venture.
Aptiv was a former partner in Motional with Hyundai, Motional is a joint venture between Aptiv and Hyundai Motor Company, which uses the IONIQ 5 electric car as its robotaxi. The EV is used in Las Vegas through Uber and Lyft.
“While our Motional joint venture continues to make progress on their technology road map, we’ve decided to no longer allocate capital to it,” Aptiv CEO Kevin Clark said during the earnings call.
Aptiv’s 2024 profit forecast of US$5.55 to US$6.05 per share includes a non-cash equity loss of about US$340 million, or US$1.20 of earnings per share, related to Motional’s losses. South Korean automaker Hyundai Motor Group agreed to pump nearly US$1 billion into self-driving company Motional.
The Hyundai Group’s new investment will see it acquire 11% of Motional’s common equity held by Aptiv for US$448 million. The funds will come from different firms across the Hyundai brand, including Kia and Hyundai Mobis (parts supplier).
In a statement to The Korean Economic Daily, the group will also fund Motional with an additional US$475 million, with the investment again split between Hyundai, Kia and Hyundai Mobis.
“Hyundai Motor Group decided to obtain stable management rights in Motional to proactively develop autonomous driving technology and internalise core technology… Hyundai Motor Group decided to obtain stable management rights in Motional to proactively develop autonomous driving technology and internalise core technology.” it read.
Aptiv joins Ford Motor, Volkswagen and General Motors in cutting down or backing out of the technology, which is often touted as the future of mobility. Reuters heard from Evangelos Simoudis, an investor, author and corporate adviser, who said:
“Companies are realising that attaining level 4 of autonomous driving is way more difficult and expensive than the industry predicted.”
Level 4 autonomous driving refers to the vehicle moving automatically in longitudinal and lateral axes and the driver does not have to keep their eyes on the road or supervise the vehicle. Last October, GM got into trouble after an accident involving a pedestrian with its robotaxi. It resulted in General Motors’ Cruise recalling 950 driverless cars from the roads across the United States and slapped with federal investigations.
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