Tesla-DeepScale Deal Puts Self-Driving in the Fast Lane


Oct. 2 2019, Updated 11:32 a.m. ET

  • CNBC reported yesterday that Tesla is acquiring computer vision start-up DeepScale to boost its fully self-driving technology.
  • The fully autonomous driving space’s vast potential has attracted legacy auto companies and tech companies. However, regulations and technology have far to go.
  • DeepScale will give Tesla the necessary software to integrate with its hardware to develop truly driverless cars.

Yesterday, CNBC reported Tesla (TSLA) is acquiring four-year-old computer vision startup, DeepScale. Also, DeepScale CEO Forrest Iandola has joined Tesla as a senior staff machine learning scientist. The companies have not yet disclosed the deal’s financial terms.

The DeepScale acquisition, set to help Tesla develop autonomous cars, will fill the gap left in Tesla’s autopilot team after 11 engineers left this summer, reports CNBC. Tesla CEO Elon Musk was reportedly not happy with the company’s progress in developing fully automated driving.

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Tesla’s DeepScale deal is another push into the autonomous vehicle space

Many auto and tech companies have jumped into the autonomous car space. However, developing fully functional autonomous cars seems to be least a few years away. Legacy automaker Ford (F) is planning to produce autonomous cars for ridesharing by 2021. Also, Alphabet’s (GOOG) self-driving car project, Waymo, has built robotaxis. Waymo is also partnering with Lyft (LYFT) in some locations. And in April, Uber (UBER) announced it was working with Volvo to build autonomous cars.

Autonomous car regulations are a work in progress

Companies are pushing for changes in rules for aspects of self-driving, such as seating positions. The National Highway Traffic Safety Administration, however, is not expected to start writing seating rules until March 2020. And Reuters reports “Comments filed by automakers suggest it could take the agency until at least 2025 to complete a comprehensive rewrite of various safety standards.”

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Morgan Stanley cuts Waymo’s valuation

There’s a lot of hype around autonomous driving technology. However, analysts seem to realize that the technology’s commercialization is still far away. CNBC reports Morgan Stanley cut Waymo’s valuation by 40% because commercialization was taking longer than anticipated.

Tesla set to launch robotaxis next year

During Tesla’s Autonomy Day in April, Musk said, “I feel very confident predicting autonomous robotaxis for Tesla next year.” However, based on Musk’s previous promises, investors are taking this target with a pinch of salt. With its cars, Tesla sells a full self-driving hardware package that enables customers to summon their cars from parking lots without driver assistance.

Tesla’s DeepScale acquisition to provide necessary software capabilities

DeepScale is set to add the software piece to Tesla’s self-driving puzzle. In January, DeepScale announced Carver21, its perception software portfolio for driver assistance. CNBC reported, “DeepScale’s technology was designed to help automakers use low-wattage processors, which are standard in most cars, to power very accurate computer vision. These processors work with sensors, mapping, planning and control systems, to allow cars to make sense of what’s going on around them.”

The market sees that fully self-driving technology and regulations could take several years to develop. However, Tesla’s aggressive push into the space shows investors it’s serious about its autonomous driving ambitions.


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