German automaker BMW, U.S. chipmaker Intel (INTC) - Get Report and Israeli computer vision company Mobileye N.V. (MBLY) will be making public their plan to produce a fully autonomous BMW model, probably by 2021.
The companies would not release details in advance but analysts said the collaboration will likely employ Mobileye's technology, already in use with several automakers, to create a sophisticated, comfortable and safe system that could take over most or all driving functions.
Harald Krueger, BMW chief executive, told shareholders in May he expected the automaker to have an autonomous car on the road by 2021. Krueger has said the technology is in place but the legal, regulatory and ergonomic frameworks must catch up.
A big winner in this deal is Intel, which has been seeking to break into the market for automotive chips. Rivals NXP Semiconductors (NXPI) - Get Report , Renesas Electronics (RNECY) ,Infineon Technologies (IFNNY) and STMicroelectronics (STM) - Get Reportdominate that market.
The three-way collaboration will be a "turning point for the automotive industry," Amnon Shashua, the chairman and co-founder of Mobileye, wrote in an emailed response to questions from Bloomberg.
Automakers around the globe have been racing to form tie-ups with companies that can provide advanced software and know-how on artificial intelligence, presumed to be the foundational competence for the creating driverless cars. Currently, automakers believe ride-sharing, vehicle-sharing and driverless autonomy could fundamentally transform their business model.
Mobileye has sold its chip sets to BMW, General Motors (GM) - Get Report and many other automakers. The company's American shares closed Thursday up nearly 10% ahead of the news conference while Intel stock closed up 2%.
German carmakers, parts suppliers and map makers Here and TomTom (TMOAF) this week agreed on a standard that would dictate how road and vehicle performance data are transmitted from Internet-connected cars to cloud-based online services, enabling more automated traffic management and car management services.
Autonomous technology relies heavily on Lidar, Radar and vision technology for sensing where the car is on the road, as well as the location of other cars and obstacles. Additional technologies including precision mapping, crowd sourced in real time by vehicles on the road, and vehicle-to-vehicle communication are expected to provide additional layers of security and safety.
Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.