Frankfurt: South Korea’s Samsung Electronics Co Ltd plans to become a major player in autonomous driving, building on its recent $8 billion acquisition of audio and auto parts supplier Harman and its pole position in mobile communications markets.
Samsung is set to announce on Thursday at the Frankfurt Motor Show that it has set up an automotive strategic business unit for autonomous and advanced driver assistance services (ADAS), together with a $300 million fund to invest in automotive start-ups and technology.
“It’s time to communicate our intent to enter the autonomous driving market,” Young Sohn, the company’s president and chief strategy officer said. “Samsung has been incubating this business for quite a while.”
The world’s biggest maker of semiconductors by revenue, Samsung is a consumer electronics giant that leads markets in products as varied as phones and TVs, displays and memory chips. These assets, and the inside track with car makers provided by its Harman subsidiary, give it confidence to enter an increasingly crowded auto market with other top tech names, Sohn said.
Samsung’s two biggest rivals have also moved into the connected car market over the past year, at greater cost: Intel Corp paid $15.3 billion last month to acquire Mobileye, the current market leader in collision-detection ADAS software, while Qualcomm Inc is seeking regulatory approval for its $47 billion deal to buy NXP Semiconductors NV, the world’s biggest maker of automotive-grade chips.
Harman, best known for its consumer audio speakers, derives 65 percent of sales from its automotive business, supplying navigation services, on-board entertainment systems and vehicle networks that put it at the intersection of connected cars and mobile networks.
Auto industry veteran John Absmeier, who before joining Samsung in 2015 ran a pioneering autonomous driving programme at U.S. tier 1 auto supplier Delphi Automotive Plc, has been named senior vice president of the Samsung automotive business unit. Absmeier will retain his current job as head of smart machines for the Samsung Strategy and Innovation Center in Silicon Valley.
Sohn said the Autonomous/ADAS business unit will absorb hundreds of engineers Samsung already has working on autonomous driving technologies.
In recent months, Samsung has secured licenses for autonomous driving pilot projects in South Korea and California.
PIECING TOGETHER A STRATEGY
While there is no coherent industry vision yet for what a connected car exactly means, creating openings for them, Harman and Samsung must move quickly in a market where vehicle design cycles can take anywhere from three to five years, he noted.
Over the next two to three years, the new Samsung Automotive Innovation Fund will invest in a range of connected car areas including sensors, machine vision, artificial intelligence, high-performance computing, cloud services, mobile connectivity, automotive-grade safety and security, the company said.
The first investment will be 75 million euros ($89 million)in TTTech, a Vienna-based firm known for safe, highly reliable network computing systems used in the Boeing Dreamliner, Audi cars including the new Audi A8, and NASA spacecraft, it said.
Previous Samsung auto-related investments include AImotive and Renovo for automated driving, Quanergy, for 3D cameras known as LiDAR, and Graphcore, a maker of high-performance artificial intelligence computing.
Sohn sought to distinguish his strategy from other consumer tech companies including Alphabet Inc’s Waymo by underlining that Samsung had no plans to make cars itself but instead would work as a tech ally for car makers.
Samsung’s new autos unit will focus on developing core technologies, while Harman will market and integrate these for auto makers, he said. Sohn is also chairman of Harman, which Samsung plans to run as a largely independent subsidiary.
Longer term, as driverless cars emerge and vehicle interiors become more like living rooms to keep passengers productive or entertained, Samsung could supply see-through computer displays that can also function as windows and Harman could see demand rise for infotainment systems and noise management technology.