Automotive parts manufacturer Delphi on Tuesday announced it's acquiring Boston, Massachusetts-based self-driving startup NuTonomy for $450 million. The majority of that figure is understood to be paid in cash, whereas around $50 million amounts to earn-outs, the company said, describing the move as the latest step in its efforts to strengthen its position in the global market and ensure it's leading a sustainable business once the autonomous driving revolution is in full swing and starts enjoying widespread adoption. The tie-up will see over 100 scientists, engineers, and other experts join Delphi's ranks where approximately the same amount of people already works on developing driverless cars. Delphi's general business strategy isn't changing with the takeover which some industry watchers see as the company's vote of confidence in its existing approach to the emerging self-driving segment.
For the time being, Delphi remains adamant that the first major opportunity in self-driving vehicles is to present itself in the enterprise segment before becoming more popular among private users. This belief is what prompted the company to commit significant resources to Automated Mobility on-Demand (AMoD) solutions which should become more scaleable following the integration of NuTonomy's assets into Delphi's existing operations, as suggested by the car parts manufacturer. The acquisition may also lead to the creation of some new products and services in the medium term, Delphi indicated, without elaborating on the matter. Since its inception in 2013, NuTonomy has been developing self-driving software meant to be deployed as an AMoD service, thus being aimed at the same market which Delphi is looking to penetrate in the future and being the main reason for the acquisition itself. Co-founders Dr. Emilio Frazzoli and Dr. Karl Iagnemma are also joining Delphi's ranks and the startup's existing partnerships with Peugeot, Lyft, and other firms should continue for the time being, albeit under the corporate umbrella of its new parent. The merger will be officially concluded by the end of the calendar year, Delphi said.
NuTonomy will continue operating from Boston going forward, though it's currently unclear whether that's also Delphi's long-term plan for the company or if it will eventually be seeking to fully absorb it into its business. The transactions marks the first major acquisition of a driverless car startup by an automotive parts manufacturer, with some analysts speculating that many similar deals are to be announced in the near future.