Volkswagen closes $2.6 billion investment in self-driving start-up Argo AIVolkswagen AG CEO Dr. Herbert Diess, left, and Ford CEO Jim Hackett during a press conference in New York, July 12, 2019.Meghan Reeder | CNBC
Volkswagen AG has closed on its $2.6 billion investment in Argo AI, the Pittsburgh-based autonomous vehicle startup announced in a blog post Tuesday.
The German automaker's deal with Argo and Ford Motor, which acquired a majority stake in the startup in 2017, included $1 billion in cash and Argo taking over VW's European self-driving unit, valued at $1.6 billion, as well as the unit's more than 1,000 employees. VW also agreed to purchase $500 million in shares of Argo from Ford over a three-year period. The deal was first announced in July 2019.
"This news not only solidifies our well-capitalized position, but differentiates us as the only self-driving technology platform company with partnerships and commercial agreements for deployment across the U.S. and Europe," Argo CEO Bryan Salesky and Reinhard Stolle, vice president of Argo Munich, wrote on Medium.com.
Ford executives, in a separate statement, said the deal will "better serve our future customers while improving cost and capital efficiencies."
In April, Ford said it would postpone plans to launch its autonomous vehicle commercial services with Argo from next year to 2022 due to the coronavirus pandemic.