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Intel to take stake in German mapping firm HERE in automated driving push

Published 03/01/2017, 18:46
Updated 03/01/2017, 18:50
© Reuters. The logo of Intel, the world's largest chipmaker is seen at their offices in Jerusalem
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FRANKFURT (Reuters) - U.S. chip maker Intel (NASDAQ:INTC) will take a 15 percent stake in German digital mapping firm HERE, it said on Tuesday, as it seeks to build its presence in automated driving technology.

A filing to the German cartel office on Tuesday showed Intel has sought approval to buy a stake in the company, which is controlled by German carmakers Daimler, BMW and Volkswagen (DE:VOWG_p).

Intel and HERE said in a statement that they had also signed an agreement to collaborate on the research and development of real-time updates of high definition (HD) maps for highly- and fully-automated driving.

Intel did not disclose how much it would pay for the stake but said the transaction is expected to close in the first quarter.

The deal highlights a shift in the dynamics of research and development in the car industry, which until recently saw automakers largely dictating terms for suppliers to manufacture their proprietary technologies at specified volumes and prices.

Now carmakers are increasingly striking partnerships with technology firms using open technology standards, seeking to harness their expertise in areas including machine learning and mapping as they race against Silicon Valley companies such as Google (NASDAQ:GOOGL), Tesla and Apple (NASDAQ:AAPL) to develop driverless vehicles.

Last month two Chinese companies and Singapore's sovereign wealth fund GIC agreed to buy a 10 percent stake in HERE and in July, BMW teamed up with Intel and Mobileye (NYSE:MBLY) to develop self-driving cars by 2021.

BMW, Daimler and Volkswagen bought HERE for 2.8 billion euros (2.3 billion pounds) in 2015 from mobile equipment maker Nokia (HE:NOKIA) of Finland.

Last September, HERE said it would introduce a new set of traffic services allowing drivers to see for themselves what live road conditions are like miles ahead using data from competing automakers, an industry first.

© Reuters. The logo of Intel, the world's largest chipmaker is seen at their offices in Jerusalem

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