Al Root
Mobileye Global stock jumped early Tuesday after the company announced new business with Volkswagen.
Shares of the autonomous-driving-technology company were up 14% in premarket trading at $17.40 apiece, while S&P 500 and Dow Jones Industrial Average futures were up 0.1%.
The move came after the company said it was working with VW and parts supplier Valeo to "upgrade the advanced driver-assistance systems up to Level 2+."
The auto industry typically classifies driver-assistance technologies from Level 1 to Level 5. Level 2 features include lane-keeping assistance, automatic braking, and adaptive cruise control. Level 2 systems require drivers' full attention 100% of the time. Levels 3, and 4 allow people to ease off in some situations. A Level 5 vehicle might not even have a steering wheel.
Level 2+ isn't an official designation. It's better than Level 2. Drivers still pay attention, but perhaps the car can navigate turns and highway exits by itself.
Eventually, the goal for auto makers and suppliers is to build on existing systems, typically with the help of artificial-intelligence computing, to let drivers stop paying attention to roads while the car does all the driving tasks.
More business for Mobileye, of course, is good news for the company. Its hardware and software are competing against systems and hardware from a host of companies, including Alphabet and Tesla. Alphabet's Waymo operates a driverless-taxi service. Tesla plans to launch a such a service this year.
"This cooperation supports us on our road to transformation: by sourcing hardware and software together, we streamline procurement, reduce complexity, and improve efficiency," said VW Board of Management member Dirk Große-Loheide in a news release.
Coming into Tuesday trading, Mobileye stock was down 23% year to date, and down 51% over the past 12 months. High-channel inventories have weighed on sales estimates and investor sentiment.
Mobileye is expected to generate 2025 revenue of $1.8 billion, according to FactSet. A year ago, that estimate was closer to $$2.7 billion.
Write to Al Root at allen.root@dowjones.com
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March 25, 2025 09:08 ET (13:08 GMT)
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