Intel set to buy Mobileye in $15.3 billion deal

Intel's Automated Driving Group will be integrated into Mobileye, run from Israel.

A combination of pictures taken in Jerusalem on March 13, 2017, shows the logos of US computer chip giant Intel (top) and Israeli car tech firm Mobileye. Intel will buy Mobileye for more than $15 billion (14 billion euros), the companies said, in a deal signaling the US computer chip giant's commitment to technology for self-driving vehicles. Credit: Thomas Coex | Getty

On Monday, Intel announced that it will purchase the Israeli automotive technology company Mobileye in a deal worth $15.3 billion. Currently, Mobileye's computer vision systems underpin the advanced driver assists present in many new vehicles across a wide range of brands. Once the deal finalizes, Intel's Automated Driving Group will be integrated into Mobileye and run from Israel. Mobileye's co-founder, chairman, and CTO, Professor Amnon Shashua, will head things up.

In a statement, Intel CEO Brian Krzanich wrote the following:

Intel provides critical foundational technologies for autonomous driving, including plotting the car’s path and making real-time driving decisions. Mobileye brings the industry’s best automotive-grade computer vision and strong momentum with automakers and suppliers. Together, we can accelerate the future of autonomous driving with improved performance in a cloud-to-car solution at a lower cost for automakers.

Mobileye and Intel are no strangers. In July 2016, the two companies revealed they are working with BMW to launch an autonomous vehicle called the iNEXT in 2021.

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The fact that Mobileye was purchased by Intel, rather than an OEM or Tier 1 supplier, should be a good thing, according to Ben Volkow, CEO of Otonomo (another Israeli automotive tech company). "If it had been an OEM, some other car companies would have cut ties with Mobileye," Volkow told Ars. "And it would have created similar problems if [Mobileye] were bought by a Tier 1 supplier. Intel is a tech company and works across the spectrum with everyone. It's a good move for them, good for the car industry, and good for the Israeli tech industry." (Indeed, the tech sector in Israel is booming, thanks in part to that country's investment in signals intelligence.)

Paul Asel, who leads Nokia Growth Partners' investment in the auto industry, told Ars:

I see it as reinforcing the potential that industry players see for autonomous driving, and also the investment that will be required to realize that opportunity. The auto OEM players are spending $45 billion on R&D—although not all of that is on autonomous driving—but it reinforces that there's a lot of money to go into this sector.

As evidence for that trend, Asel also pointed to the news late last year that Samsung announced plans to buy Harman for $8 billion.

This is the second big investment by Intel in the autonomous driving space this year. In January, the company revealed it was purchasing a 15-percent stake in the mapping company Here.

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