Nvidia To Halt AV Fleet Testing As Uber Investigates Fatal Crash

NVIDIA Corporation NVDA will temporarily suspend on-road tests of self-driving technology as it awaits clarity on the cause of Uber’s fatal crash, Reuters first reported.

What Happened

Nvidia had announced in January a partnership to embed its artificial intelligence technology into Uber’s fleets.

Management intends to “learn from the Uber incident” and in the meantime will continue to operate and collect data from its manually-driven auto fleet. Its autonomous-vehicle trials in New Jersey, Santa Clara, Germany, Japan and other locations worldwide will resume at an undetermined date.

“Ultimately, AVs will be far safer than human drivers, so this important work needs to continue,” Nvidia said in a statement.

Why It's Important

The delay, though, is meaningful to both Nvidia and AV investors.

Tigress Financial analyst Ivan Feinseth recently dubbed Nvidia the undisputed leader among chipmakers in the AV space, topping both Advanced Micro Devices, Inc. AMD and Intel Corporation INTC. Its technology works in partnership with Continental and is embedded in the vehicles of Volkswagen, Deutsche Post DHL Group, ZF and others.

Each one is meaningful to the Nvidia thesis. From its Toyota Motor Corp (ADR) TM deal, alone, analysts expect $1 billion to $1.7 billion in incremental sales over the next two years.

Considering its exposure to the AV space, Tuesday's news catalyzed 4-percent sell-off in Nvidia's stock.

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Image Credit: yoggy0 from Yokohama, Japan (SIGGRAPH Asia 2009) [CC BY 2.0], via Wikimedia Commons