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Illustration: Sarah Grillo/Axios

Rivals BMW and Daimler are the latest automakers to start pooling resources in order to stay competitive while they push toward full autonomy.

The big picture: Once there was a race among auto and tech companies to develop self-driving cars, but now there's a shared belief that it's frustratingly hard and incredibly expensive to do so at scale.

  • For some, partnering on a step-by-step progression through the various levels of autonomy seems the most expedient way to try to bring the technology to market.

What's happening: BMW and Daimler, Mercedes Benz' parent, are teaming up on automated driving, joining a growing list of AV research couples: Toyota and Uber, GM and Honda, and Ford and Volkswagen.

  • BMW and Daimler will focus on next-generation technologies for driver-assistance systems, highly automated highway driving and self-parking features — which are all considered Level 3 or 4 autonomy.
  • They aim to make those technologies available in the mid-2020s for global markets while separate research continues on longer-term projects.
  • For example, Mercedes and Bosch will start testing Level 4 and 5 robotaxis in San Jose, California, this summer.

BMW and Mercedes are usually bitter rivals, but the shifting transportation landscapehas a way of turning enemies into friends.

  • The German luxury carmakers are also pooling their resources on mobility services, investing $1 billion in a joint venture that spans ride-hailing, multi-modal transportation and related services.

What we're hearing: Industry experts predict even more collaboration on automated driving technology in the near future.

  • The likelihood of a recession or cyclical downturn means big R&D expenditures are riskier, says Sam Abuelsamid, principal analyst at Navigant Research.
  • AV development becomes more complex as the level of autonomy increases, Michael Hafner, head of driving technologies and automated driving at Mercedes-Benz Cars, explains in a blog post.
  • Shouldering the technological and financial burdens together makes sense, even though BMW and Mercedes will always be competitors, Hafner writes.

What's next: AVs aren't here yet, but already they're becoming a commodity. What will differentiate auto companies in the future won't be whose AV technology is safer — airlines don't compete on safety, after all — but which one delivers a better customer experience.

"Once they’re driving the speed limit in the middle of the lane and keeping you from dying, that’s not a differentiated experience."
— Mike Ramsey, research director, Gartner

Go deeper: Amazon's autonomous vehicles bet could make deliveries even cheaper

Go deeper

Sen. Sheldon Whitehouse under scrutiny for elite club affiliations

Sen. Sheldon Whitehouse during a Senate hearing on Capitol Hill in February. Photo: Susan Walsh-Pool/Getty Image

Sen. Sheldon Whitehouse (D-R.I.) said in a statement Wednesday that he is a member of an exclusive Rhode Island sailing club that lacks diversity.

Why it matters: Whitehouse has repeatedly spoken out against systemic racism and come under scrutiny this week for his family's affiliation with elite clubs. This is the second such club accused of lacking diversity that the senator has been linked to in recent days

2 hours ago - Politics & Policy

Scoop: Border Democrats want migrants vaccinated

Rep. Filemon Vela (D-Tex.) Photo: Chip Somodevilla/Getty Images

Some Democrats representing border districts want President Biden to vaccinate migrants crossing into the U.S. — especially if he lifts public health restrictions that have prevented them from claiming asylum on American soil.

Why it matters: Inoculating migrants treads a fine line of protecting the U.S. population while possibly incentivizing more migration with the offer of free COVID-19 vaccines. Republicans are likely to pounce on that.

2 hours ago - World

State Dept. fears Chinese threats to labor auditors

A space for media is designated by Chinese authorities near a mosque in the Xinjiang region of China. Photo: Greg Baker/AFP via Getty Images

The State Department is concerned organizations performing supply-chain audits in China are coming under pressure from Chinese authorities.

Why it matters: U.S. law prohibits importing products made through forced labor, but it's becoming increasingly difficult to verify whether products from China are tainted.