Apple Buys Self-Driving Car Startup Drive.ai in Sign It's Not Through With Autonomous Vehicles

By Tom McKay on at

Apple appeared to be pulling back from the autonomous car business when it dismissed some 200 employees from its Project Titan initiative in January 2019. But it would appear that it’s shifting gears in a big way with news on Tuesday that it has acquired startup Drive.ai “in what appears to be part of a renewed effort by the iPhone and Mac maker to branch out into self-driving cars,” per the San Francisco Chronicle.

According to the Chronicle, Drive.ai had recently told state officials it was folding and expected to lay off 90 workers by Friday. But Apple has poached “dozens of hardware and software engineers” from the company and has now confirmed it purchased it outright, according to the paper. Prior reporting in the Information has suggested the company had been looking for potential buyers since February 2019 and that the purchase is an “acqui-hire,” meaning that Apple was primarily interested in snapping up Drive.ai’s talent before a competitor had the opportunity.

The Chronicle noted that Drive.ai touted itself as a company developing kits to convert normal cars into autonomous ones, “though it’s not clear how many of its partnerships turned into reality.” Projects it had engaged in include a shuttle service in Arlington, Texas, a since-concluded test in Frisco, and a partnership with Lyft in 2017 that currently has an “unclear” status,” the paper wrote. That Frisco test raised some eyebrows when Drive.ai decided to remove human safety drivers from some of its vehicles, just months after an Uber prototype vehicle struck and killed 49-year-old woman Elaine Herzberg in Tempe, Arizona.

Axios reported that Drive.ai was valued at some $200 million two years ago, but Apple likely paid less than the $77 million it had raised in venture capital, making the venture a net loss to investors. Apple has tested self-driving Lexus vehicles in California but hasn’t publicly clarified whether it is focused on building its own Apple-branded car or software development. According to MacRumors, “reliable Apple analyst” Ming-Chi Kuo believes that if the company is working on such a vehicle, it wouldn’t be ready until 2023 or 2025 – far behind some of the wildly optimistic projections from competitors like Tesla, whose CEO Elon Musk recently claimed that it will achieve true Level 5 autonomy by next year.

Featured image: Tony Gutierrez (AP)