Mercedes has signed a production agreement with British autonomous driving startup Waabi and decided to install Waabi's artificial intelligence (AI) driving system in its vehicles within two years. It is the first case of Waabi's end-to-end driving AI being applied to mass-produced premium passenger car models.

On Sept. 22, Mercedes and Electrek and other foreign media reported the companies will integrate Waabi's "AI Driver" into Mercedes vehicle hardware, the MB.OS operating system and map interfaces. It is expected to be offered to customers as an advanced driver assistance feature that helps with travel from origin to destination on city streets and highways. Specific vehicle models, markets and launch timing were not disclosed, and the level of automation under Society of Automotive Engineers (SAE) standards was not presented.

Waabi develops driving software rather than producing vehicles itself. Waabi is promoting an embodied AI-based "AV2.0" approach that learns from driving data, moving away from methods that rely on fixed rules and high-definition maps. Waabi said AI Driver can respond to new city environments without high-definition maps, geofencing or city-by-city retraining. The latest system also includes radar.

The deal also means the companies have expanded their existing technical cooperation into the mass-production stage. Waabi received investment from Mercedes earlier this year during a $1.5 billion Series D fundraising, and Nissan and Stellantis also participated as investors. Waabi's valuation at the time was assessed at $8.6 billion.

Mercedes Chief Technology Officer Joerg Burzer (요르크 부르처) called the partnership the "world's first case" of integrating Waabi's AI Driver in the premium segment. Alex Kendall (알렉스 켄들), Waabi's co-founder and chief executive officer, also said the development collaboration shows a technical link between the two companies.

Mercedes is running multiple systems rather than relying on a single autonomous driving technology. Mercedes is already selling its Level 3 system, Drive Pilot, which allows drivers to take their hands and eyes off driving in highway traffic jams. The system was introduced as the first Level 3 driver assistance system certified on U.S. roads.

Mercedes is also pursuing a Level 2+ driving assistance system that uses Nvidia's autonomous driving AI technology. Mercedes showcased a system through the CLA that assists driving from origin to destination, and Nvidia's Alpamayo technology is used in the system. With Waabi's AI Driver added, Mercedes will have a structure that operates different approaches to autonomous driving technology at the same time.

Mercedes is currently running in parallel a Level 3 system for limited highway environments, an Nvidia-based Level 2+ system that supports driving from origin to destination, and Waabi's AI-based system that learns from driving data without high-definition maps. Waabi's system is being presented as a technology that can be expanded to higher levels of automation in the future.

The move shows autonomous driving development approaches in the auto industry are diversifying. Unlike Tesla, which develops autonomous driving software in-house, traditional automakers are expanding autonomous driving functions by working with specialist technology companies such as Waabi, Nvidia and Mobileye. Waabi has been expanding cooperation with automakers, including recently agreeing over the past year to supply its technology to Stellantis and Nissan.

With the deal, cooperation between Mercedes and Waabi has expanded beyond investment to the stage of applying the technology to actual mass-produced vehicles. But because specific models, automation levels and launch timing have not been disclosed, the actual scope of commercialisation is expected to be confirmed through additional announcements.