BMW and Daimler Announce They’ve Shit the Bed in Autonomy Partnership

If you’re following the autonomy race closely, you’ve probably already heard that BMW and Daimler released a joint statement ending their autonomy partnership yesterday. The memo was one of the funniest things I’ve read in a while, because it sums up the state of autonomy software at legacy automakers so well. I wanted to pick it apart together here today so we can all laugh again, and try and figure out what’s really going on here.

Partners reach joint decision: BMW Group and Mercedes-Benz AG put development cooperation in automated driving temporarily on hold – may be resumed later


Wow, what a headline. There’s a lot to unpack here already.

“Partners reach joint decision”. Was it really a joint decision, or did one company want to dump the other? Normally when a corporation makes a point of emphasizing something like this, it’s a sign that the opposite of what they’re saying may be true –– they mention it because they’re consciously trying to deflect from the real story. In this case however, I have no problem believing that this decision was truly mutual. I think both companies could see what a disaster this deal was, and both were happy to abandon it. I don’t think they had any clue what they were doing, nor do I think they have a better idea of what their autonomy strategy is today.

The other part I love is that they don’t say they’re abandoning the partnership. They try and sugar coat it by saying the project is just “temporarily on hold” and “may be resumed later”.

Autonomy isn’t exactly the kind of project you can just pause due to budget cuts and expect to pick up later. What new hire would join that team, and who is going to stick around through this “temporary hold”? Moreover, when exactly will these two German luxury giants be ready to jump back in bed together? Before Autopilot is feature complete this year? After that? The chance of this partnership restarting is a lot closer to 0 than this press release is letting on.

Then there’s some bullet points which I’ll translate from bullshit to English below:

Both companies will continue to pursue their own development path


“Yeah, we’re both going to continue working on autonomy just not with each other”

Technological understanding of both partners remains a good fit


Right… which is why you guys don’t want to work together?

Successful collaboration to continue in other fields as planned


“We love working together on other things, and we’re going to work on autonomy, but we’re just not going to work together on autonomy. Reason is neither of us know how to do it, so partnering is just stupidity squared”

Fröhlich: “Current technology puts us into excellent position for many years”


Your current technology is good enough? Does anyone at the company really believe that? You’re behind Tesla today. How much further behind will you be next year?

Schäfer: “Sounding out possibilities with partners outside automotive sector”


“We have no clue what the hell we’re doing. Can someone please help us? Someone who understands tech?”

The BMW Group and Mercedes-Benz AG are putting their cooperation on development of next-generation technology for automated driving temporarily on hold. Following extensive review, the two companies have arrived at a mutual and amicable agreement to concentrate on their existing development paths – which may also include working with current or new partners


“I think we should see other people”

Both explicitly wished to emphasize that cooperation may be resumed at a later date and that the two organizations’ underlying approach to matters such as safety and customer benefits in the field of automated driving remains highly compatible.


Here, “highly compatible” means “we are both doing the same thing separately, and neither of our efforts will work out”.

The BMW Group and Mercedes-Benz AG are both working separately on current generations for highly-automated driving and have achieved major progress in this field in the past. However, the BMW Group and Mercedes-Benz AG were unable to hold detailed expert discussions and talk to suppliers about technology roadmaps until the contract was signed last year.


This is the hilarious thing about legacy auto. Tesla’s Autopilot system can evolve dramatically and ship to cars around the world in the course of a year. For legacy auto, it takes a year just to sign the contract. We saw this when it took Volkswagen one year to finalize its investment in Argo, and we’re seeing it here now.

Some suits in the executive suite thought it would be a great idea to combine BMW and Daimler’s autonomous efforts. Sounds like it would save money, right? It was only once the contract was painstakingly negotiated and signed that they actually had their engineers talk to each other. At that point, they realized the deal and their autonomy strategy made no sense.

When you have two separate autonomy systems, its extremely difficult to impossible to combine them. It would be like trying to combine Mac and Windows into one operating system, or iOS and Android into one smartphone OS. You’d waste so much time combining the separate systems that it would be a step backwards for the autonomy effort.

In these talks – and after extensive review – both sides concluded that, in view of the expense involved in creating a shared technology platform, as well as current business and economic conditions, the timing is not right for successful implementation of the cooperation.


The fact that they keep saying “extensive review” disturbs me. Any 18 year old hacker could have told you this partnership was doomed in a 5 minute consultation.

When will the timing be right for BMW and Daimler to build an autonomous car? Probably around the time it makes sense for McDonalds and Burger King to get together and start designing lingerie. This isn’t to say McDonalds, Burger King, BMW, and Daimler aren’t filled with talented people: They’re just not good at underwear, or autonomous software.

“We have systematically further developed our technology and scalable platform with partners like Intel, Mobileye, FCA and Ansys,” said Klaus Fröhlich, member of the Board of Management of BMW AG, responsible for Development. “Our current technology generation offers very strong, sustainable potential: With extremely powerful sensors and computing power, our robust modular system puts us in an excellent position to offer our customers what they need for many years.”


MobilEye was great in 2016, sure. But will it still be cutting edge in 2023? Daimler is hoping so. I will say, MobilEye is one of the more serious autonomy players, and they’re taking a vision based approach. For Daimler, putting all their eggs in MobilEye’s basket isn’t a bad strategy. BMW and other OEMs would probably do well to follow suit.

“Our expertise complements that of the BMW Group very well, as our successful collaborations have proved. Next to decarbonisation, digitalization is a central strategic pillar for Mercedes-Benz. To prepare for the future challenges of a rapidly changing environment, we are currently also sounding out other possibilities with partners outside the automotive sector.”

Markus Schäfer, Member of the Board of Management of Daimler AG and Mercedes-Benz AG; responsible for Daimler Group Research and Mercedes-Benz Cars COO:

Translation: “We know we’re fucked on software, and we’re trying to figure out who can help us. But we can tell you for sure, it definitely isn’t BMW”.

Both companies also underlined that they would continue working in close cooperation in the remaining fields as planned. In 2015, the two companies joined with Audi AG to acquire the location and technology platform HERE, which now has a very broad and international shareholder structure. In early 2019, the BMW Group and Daimler AG also pooled their mobility services in a joint venture under the umbrella of the NOW family.


Forget about “HERE” and “NOW”. These companies need to figure out out to ship an autonomous electric vehicle here and now, or both companies are headed for bankruptcy.

An Alternate Reality

In an alternate reality, the German luxury giants said “Holy shit. Look at what Tesla is doing with Autopilot. We need to do everything we can to catch up with them”. And they would have been a few years behind, but they’d be able to compete pretty well with people who hadn’t tried a Tesla for a while.

But in this reality, they’re blowing their chance. While they’re figuring out what contracts to sign, Autopilot is advancing. Before they even know who they’re going to partner with, Autopilot will be feature complete. While they wait for the ink to dry, Autopilot will continue saving lives today.

Legacy auto has let their eyes off the prize. With global shutdowns and recessions hitting OEMs hard, nobody is thinking about an autonomous electric future. They’re just trying to stop the red ink bleeding down their income statement, no matter what it takes. Since forward looking autonomy and electrification projects don’t look likely to produce earnings anytime soon, they’re usually the first on the chopping block.

It all adds up to a situation where Tesla alone is pushing forward relentlessly on EVs, expanding production, new battery technology, and most of all… Autopilot. It’s legacy auto’s last chance, and they’re shitting the bed. Big time.

With EV programs getting delayed or pulled and oil prices hitting new lows, I worry that legacy auto will seize the opportunity to weasel out of their bold zero-emission commitments. Thankfully, we have Tesla. As long as one company is pushing forward, peers will be forced to follow suit or die unceremoniously.

Legacy auto is weaker than ever. Tesla is stronger than ever. Let’s see what happens next.

Read the full statement on Daimler’s website

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