According to an Allied Market Research report, the global autonomous vehicle market size is projected to grow from $54.23 billion in 2019 to $556.67 billion by 2026 at a CAGR of 40%. Fremont-based Pony.ai is a leading player in the market.

Pony.ai’s Offerings

Pony.ai’s co-founder Tiancheng Lou graduated from Beijing’s prestigious Tsinghua University and then went on to work as an autonomous-driving engineer for Google and Baidu. Lou had always been a computing genius and he wanted to take it upon himself to solve what he considers one of the biggest technological challenges – how to make large numbers of cars drive autonomously safely. With his experience and a new mission in mind, he co-founded Pony.ai in 2016 with James Peng, his colleague at Baidu’s US research center.

Pony.ai is targeting the creation of an autonomous car that can drive itself in all conditions without the requirement of a human driver. Known as Level 5 autonomous driving technology, this is the hardest level to achieve. But Pony.ai remains committed to the goal. It has already become China’s most valuable self-driving venture. It currently operates out of both Guangzhou, China and Fremont, California.

In China, Pony.ai has already launched an autonomous ride-hailing service, thus becoming the first to launch a service of its kind. Competitor Baidu, which is also working on a similar goal, delivered a similar service nearly a year later. As of July 2019, Pony.ai operated a fleet of 30 self-driving taxis and robotaxis in a test zone in China. Robotaxis currently require a driver to be sitting in the car but are used to collect data needed to continuously improve the technology.

Last November, Pony.ai and Hyundai also unveiled BotRide, a shared, on-demand Robotaxi that will operate on public roads in California to serve the local community of Irvine. Using the BotRide app, riders will be able hail a Hyundai KONA Electric SUV directly from their smartphone. The app directs passengers to nearby stops for pick up and drop off. BotRides are autonomous cars, but they come with two safety drivers to ensure passengers are not at risk. Pony.ai’s technology then allows the BotRide to navigate complex road scenarios safely. The BotRide pilot is an important step in the ultimate deployment and commercialization of the autonomous driving technology.

Pony.ai’s Financials

Pony.ai is currently privately held and does not disclose financials. It has raised $264 million in funding from investors including KUNLUN, Adrian Cheng, Redpoint Ventures China, Sequoia Capital China, Hongtai Capital Holdings, Delong Capital, ClearVue Partners, Eight Roads Ventures, DCM Ventures, and China Merchants Capital. Its last funding round was held in April last year when it raised $50 million in a round led by KUNLUN at an undisclosed valuation for a 3% stake. An earlier $102 million round held in July 2018 led by China’s ClearVue Partners and Eight Roads Ventures had valued the company at about $1 billion.

Pony.ai has been using the venture funds for fleet expansion and product development. It believes that the next major challenge within the autonomous driving industry will be “small and medium scale deployment” to validate “the system’s overall stability and reliability”. At present not only is the technology expensive, but it is also under severe scrutiny. Recent reports of fatal accidents involving cars like Tesla while being driven under the self-driving mode don’t make the challenge easier.