Shares of the self-driving technology company Mobileye experienced an increase on Tuesday, peaking at a 13.6% rise before stabilizing with an 8% gain by 2:54 p.m. ET. This upward movement followed Mobileye’s announcement of an enhanced collaboration with its key client, Volkswagen. Volkswagen will incorporate Mobileye’s new Surround ADAS (advanced driver-assistance system) into its MBQ modular vehicle platform for future self-driving applications.
Volkswagen, the world’s second-largest automaker, could indicate a potential turnaround for Mobileye following a challenging year. The companies issued a joint press release on Tuesday detailing an enhanced partnership aimed at upgrading Volkswagen’s self-driving capabilities in its mass-market vehicles.
This collaboration also involves Valeo, a self-driving company that will supply sensors and the electronic control unit. These components will integrate with Mobileye’s EyeQ6 processor, mapping technologies, and the new Surround ADAS software platform. Volkswagen plans to use these integrated technologies to enable Level 2+ self-driving on highways. Other advanced driving features include traffic jam assist, hazard detection, parking assist, driver monitoring, and 360-degree emergency assist.
Crucially, this integrated system will be implemented into the MBQ architecture, which Volkswagen employs in several high-volume models. As a result, Mobileye could benefit significantly from the volume associated with the adoption of the Surround system.
In addition to the announcement with Volkswagen, Mobileye released a blog post discussing Surround ADAS. Surround aims to bring advanced features to lower-priced, high-volume vehicles for greater autonomy, while Mobileye’s SuperVision remains its premium offering for high-end vehicles striving for “eyes-off” autonomy.
Mobileye has recently concluded a difficult year where revenue declined by 20%, primarily due to higher interest rates and broader economic uncertainty impacting the auto sector. The management anticipates a return to growth in 2025, projecting revenues of $1.75 billion, marking a 6% increase over 2024. However, this still falls short of the $2.08 billion generated in 2023. Investors will closely watch for potential revisions to this outlook following the enhanced partnership with Volkswagen when Mobileye announces its Q1 earnings later in April.
