Samsung Electronics Co. is upping its $8 billion bet on automotive technology, forming a separate business unit within Harman to house autonomous driving products and plowing $300 million into a new fund investing in startups in the space.
The autonomous driving unit will compete on everything from driving algorithms to systems integration, Dinesh Paliwal, Harman’s chief executive officer, said in a phone interview. That will include an advanced-driver assistance platform with open software that allows outside engineers to build products off of it — a shot at Mobileye, which was acquired by Intel Corp. this year in a move that mirrored Samsung’s automotive leap.
“Our industry is literally screaming, saying, ‘We love Mobileye but we need an open platform,”’ Paliwal said. “Competition is the best thing ever. The auto industry wants us to do it and we think we have the capacity and the fuel power.”
The South Korean smartphone maker, which snapped up U.S.-based Harman International Industries Inc. last year for $8 billion to elbow its way into the hotly contested market for automotive tech, is betting it can marry its consumer electronics expertise with Harman’s presence in dashboards all over the world. If it works, it will be able to offer carmakers a lightning-quick connected system for infotainment, mapping, concierge services and autonomous driving — without the competitive anxieties other tech giants like Apple Inc. or Alphabet Inc.’s Google tend to arouse.
John Absmeier, vice president of smart machines for the Samsung Strategy & Innovation Center and former director of Delphi Automotive Plc’s autonomous vehicle project in Silicon Valley, will lead the new unit, which was announced Thursday at the Frankfurt motor show.
To further access to new tech, Samsung is also creating a fund to invest in an array of technologies needed to enable self-driving and connected cars, from sensors and machine vision to artificial intelligence and security. The fund’s first strategic investment will be in TTTech, a safety-controls developer for autonomous systems.
In a statement announcing the unit, Samsung was careful to note that it won’t enter the car-manufacturing business, positioning itself as non-threatening ally to automakers. Samsung in August received a California permit to test autonomous cars on public roads.
“If we were not acquired by Samsung, in five years’ time we would have been struggling,” Paliwal said. “This is all about scale going forward.”