Autonomous Vehicle Contract Manufacturing + China·Tesla Rival... Hyundai Motor and Google Align Interests

Hyundai Motor and Waymo Leap into Strategic Partnership
Leading Market with Waymo SW + Hyundai Motor HW Technology
Waymo Dominates US Robotaxi Market
Cost Reduction and China-Free Supply Chain Make Hyundai Motor the Optimal Partner

The collaboration between Waymo, a leading autonomous driving technology developer in the United States, and Hyundai Motor Company for autonomous driving foundry production is seen as a result of aligned interests between the two companies. Waymo needed a stable and cost-effective automaker within the U.S., while Hyundai aimed to secure profitability in new areas by leveraging its advanced autonomous driving hardware manufacturing technology.

To realize Level 4 or higher autonomous driving technology that requires no driver, not only advanced software but also cutting-edge hardware manufacturing technology to support it is crucial. High-performance graphics processing units (GPUs) capable of analyzing vast amounts of real-time data, along with advanced sensors such as cameras, lidar, and radar, are essential. Additionally, stable parts supply and cost reduction strategies during vehicle manufacturing play a significant role.

Securing the Largest Customer Just One Month After Announcing the "Autonomous Driving Foundry" Business

In late August, Hyundai Motor declared its entry into the 'autonomous driving foundry' sector at its CEO Investor Day. This announcement appears to have been made based on mutual understanding regarding collaboration with Waymo. Hyundai stated that it is developing autonomous driving computing hardware that guarantees safety and reliability under any circumstances and plans to implement an 'end-to-end' deep learning model that performs perception, decision-making, and control of autonomous vehicles comprehensively, expanding its application to autonomous driving solutions.

Ioniq 5 model to be equipped with Google Waymo's autonomous driving technology in the future
[Photo by Hyundai Motor Company]

Waymo, which started as Google's autonomous driving division, spun off in 2016 and is now a subsidiary of Alphabet. Recently, Waymo has established a dominant position in the U.S. robotaxi market. Currently, Waymo is the only company operating paid robotaxi services without drivers in the U.S. Since August last year, Waymo has been operating its robotaxi service 'Waymo One' starting in San Francisco, California. The number of paid rides for Waymo's robotaxi surpassed 100,000 per week just three months after reaching 50,000 rides per week in May.

General Motors (GM) Cruise, a strong competitor, also launched robotaxi services around the same time but had to suspend operations in San Francisco after a series of accidents involving pedestrians. Tesla, which sells millions of vehicles annually and actively collects driving data, is also cited as a factor intensifying the autonomous driving development competition.

Analysts suggest that the U.S.-China rivalry over advanced technologies such as autonomous driving and artificial intelligence (AI) influenced Waymo's choice of foundry partner. In August, Waymo unveiled its 6th-generation robotaxi developed in collaboration with the Chinese electric vehicle brand Zeekr. This robotaxi is equipped with advanced sensors, including 13 cameras, 4 lidars, 6 radars, and external audio receivers.

With the installation of numerous advanced sensors requiring cutting-edge technology, cost reduction became a major challenge for Waymo. However, after the U.S. government announced a sharp increase in tariffs on Chinese-made electric vehicles from 27.5% to 102.5% starting late last month, Waymo had to revise its strategy. From Waymo's perspective, it needed a manufacturer with excellent production technology, stable manufacturing capabilities, and cost reduction potential. Moreover, amid the U.S.-China conflict escalating into a 'data supremacy competition,' Waymo required a trusted automaker within the U.S. that could safeguard the vast autonomous driving data generated domestically.

Waymo logo
Photo by Yonhap News

Simultaneously Solving Cost Reduction, Data Security, and Suitable Vehicle Supply for Technology Implementation

Securing suitable hardware, i.e., physical vehicles, to implement autonomous driving technology is also a critical task in the development process. Chinese search engine Baidu is conducting an autonomous driving project called Apollo, and its latest 6th-generation autonomous driving vehicle has no steering wheel on the driver's side. Baidu ordered this vehicle from local automaker Jiangling Motors specifically for autonomous driving technology development. The production cost was reduced to less than half compared to previous models.

Considering these factors, selecting Hyundai Motor is the best choice for Waymo. Hyundai is recognized for its significant advancement in autonomous driving hardware manufacturing technology alongside its development of proprietary autonomous driving software. Additionally, Hyundai holds unparalleled competitiveness in cost-effective manufacturing through vertical integration of parts and flexible production structures.

Furthermore, Waymo's stable production infrastructure within the U.S., where it has started its robotaxi business, makes Hyundai highly attractive for potential mass production in the future. Hyundai Motor Group's dedicated electric vehicle factory (HMGMA) in Georgia, U.S., is currently in the final stages of completion and is expected to transition to mass production soon after trial production.

Baidu's 6th generation autonomous taxi concept model. There is no steering wheel on the driver's side inside the cabin either.
[Photo by Choi Dae-yeol]

Song Chang-hyun, President of Hyundai Motor Group's AVP Division, said, "Hyundai Motor recently decided to supply vehicles capable of implementing Level 4 or higher autonomous driving technology based on SAE standards to global autonomous driving companies through its autonomous driving vehicle sales foundry business. Waymo, as an industry leader, is the best partner to start this business."

Tekedra Mawakana, Co-CEO of Waymo, said, "We are very pleased to strengthen our mission to become the world's most trusted driver through our partnership with Hyundai Motor. Hyundai, with its focus on sustainability and a strong electric vehicle roadmap, will be an excellent partner for Waymo as we aim to provide fully autonomous driving services to more users in more regions."