Pittsburgh’s Argo AI is shutting down

Argo AI is shutting down, the company confirmed on Wednesday following a TechCrunch report. What remains of the Strip District-based self-driving technology company will be absorbed by Ford and Volkswagen.

Anonymous sources told TechCrunch that the announcement was made Wednesday during a meeting of Argo’s roughly 2,000 employees. Although all employees will be given a severance package consisting of two bonuses and health insurance, it remains unclear who will receive an offer to work for Ford and or Volkswagen.

I have the greatest respect for the team at @ArgoAI & what they've accomplished. I’m excited we're going to bring in many of these brilliant people to @Ford to help us create a terrific L3 BlueCruise system that enables our customers to travel w/o their eyes on the road.

— Jim Farley (@jimfarley98) October 26, 2022

The Pittsburgh company rose to prominence shortly after its 2016 founding when it received $1 billion in support from Ford. After that initial investment, it managed to raise an impressive $2.6 billion, mostly from the two entities that now plan to absorb it.

“We are incredibly grateful for the dedication of the Argo AI team, and so proud of our achievements together,” Argo AI CEO Bryan Salesky and President Dr. Peter Rander said in a joint statement. “The team consistently delivered above and beyond, and we expect to see success for everyone in whatever comes next, including the opportunities presented by Ford and VW to continue their work on automated driving technology.”

The news may be a shock to the Pittsburgh tech community. Argo AI was expected to go public by this summer, per Salesky’s 2021 pledge. Yet those plans were thrown into question after a round of layoffs in which 150 staffers left the company in July 2022.

Setbacks aside, the company seemed primed to continue making progress this year, with Ford’s support and pilot programs lined up in Texas, Florida and locally, including with the likes of Lyft, Walmart and 412 Rescue. Just last month, Argo had announced its new products made to support commercial delivery and robotaxi operations.

Still, TechCrunch reports that this final chapter is happening as Ford opts to switch gears from autonomous vehicles technology to driver assistance systems after reflecting on its third-quarter earnings. Ford’s earning report shared that there’d been a $2.7 billion non-cash pre-tax impairment on the Argo AI investment which led to a $827 million loss in the third quarter.

This is a developing story. See Technical.ly’s follow-up reporting, published Oct. 27: “What does Argo AI’s shutdown mean for the future of Pittsburgh tech?“

Atiya Irvin-Mitchell is a 2022-2024 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Heinz Endowments.