Hyundai Motor Group, Aptiv launch autonomous vehicle brand 'Motional'

Karl Iagnemma, Motional CEO, joins The First Trade with Alexis Christoforous and Brian Sozzi to discuss the joint venture between Hyundai Motor Group and Aptiv. Iagnemma also weighs in on the future of autonomous vehicles, the company's customers and more.

Video Transcript

BRIAN SOZZI: All right, this morning Hyundai Motor Group and Aptiv's autonomous-driving joint venture announced their official name and brand identity, Motional. Here to discuss for a first on Yahoo Finance is President and CEO of the venture, Karl Iagnemma. Karl, good to see you this morning. What's your hopes for this partnership? What are you looking to achieve?

KARL IAGNEMMA: Well, Motional's mission is to make driverless vehicles a safe, reliable, and accessible reality, and ultimately change the way the world moves.

ALEXIS CHRISTOFOROUS: Talk us about this name, Motional. It's not emotional. It's Motional. What's behind that?

KARL IAGNEMMA: Yeah, really two parts to it. You know, motion speaks to what we're building, the driverless-vehicle products themselves, the forward momentum for us as a business. But emotional-- you know, whether we like it or not, transportation decisions have become emotional decisions. Deciding how you're going to get from point A to B safely has become an emotional decision.

So we're going to build products that deliver peace of mind, and we're going to have that people-first mentality at the center of everything we do.

BRIAN SOZZI: Karl, we get so many-- we hear so many different timelines on when we might see fully autonomous cars on the road. What's the timeline for you?

KARL IAGNEMMA: We've got autonomous vehicles on the road today. You know, if you go to Las Vegas and download the Lyft app, you can experience a ride in one of our vehicles. We've given over 100,000 trips over the past year plus. 98% of our riders give us a five star out of five rating.

So we're off to a great start. Obviously our product-development process, we continue to iterate and improve over time, and we'll have new products coming to market in the future.

BRIAN SOZZI: What do you see on the infrastructure front? I still don't see-- I mean, I understand some markets like a Vegas, they have these autonomous cars. Are you seeing the infrastructure to support fully autonomous cars? Has that started to change? Because I don't see it yet.

KARL IAGNEMMA: Well, you know, we have designed our systems to be compatible with the infrastructure as it is today. We don't want to be waiting for infrastructure to come because that can be on a longer time scale than, frankly, we have patience for. So we're designing our systems to work with what's on the ground today.

ALEXIS CHRISTOFOROUS: What about the cost to make all of this happen? And what might the cost to the consumer or the business be?

KARL IAGNEMMA: Well, the cost of componentry of these vehicles is not inexpensive, but when put into a mobility-service model, it's affordable because what we're comparing against is the cost of a human driver. The net-net of it is if you can put an automated vehicle on the road, a driverless vehicle, the cost to the consumer should be significantly cheaper than a human-driven vehicle.

BRIAN SOZZI: Karl, when might a consumer be able to buy a fully self-driving vehicle and just go down their street in it? Because there are different lanes opening up here. You see a lot of companies focusing on robotaxis, but it's unclear when I can go to a dealership and buy one of these, outside of a Tesla. I understand what they're doing but the average consumer.

KARL IAGNEMMA: Yeah. You know, we focus on the robotaxi opportunity today because the economics makes sense for us. It's the biggest near-term opportunity for our technology.

Longer term, we want to be selling to consumers. It's a different value proposition. What we're going to do is wait for the component costs-- the computers cost and the costs of the sensors to come down to a point where, you know, your average consumer is willing to pay for it. We see that as being later in this decade. It's a few years out.

ALEXIS CHRISTOFOROUS: You know, Karl, this coronavirus pandemic has definitely made it be another hurdle, I would imagine, in your industry to get these kinds of cars to market. What has the pandemic done to your business and to the timeline?

KARL IAGNEMMA: Well, I'll tell you what it's forced us to do is really reconsider what it means to be safe, to deliver a safe ride. You know, previously safety was just about avoiding crashes. Now safety is about avoiding crashes but delivering a trip that minimizes the risk of infection. So it's really had an impact on our product-development strategy.

From a productivity standpoint, for us internally, you know, we're primarily focused on building software. We've continued to be productive. We haven't had as many cars on the road testing, so we relied more on simulation. So the team has done a fantastic job of continuing to be productive despite the COVID impacts.

BRIAN SOZZI: Karl, you mentioned robotaxis in Vegas. Where else might we see your offerings pop up over the next 12 to 24 months?

KARL IAGNEMMA: Well, we talk to a number of cities. You know, when we look at a targeted city from a go-to-market perspective, we want to go to a place where the demand is there, mobility demand, and where, frankly, our government partners, our regulatory partners want us to be there. So we look for welcoming environments. Got a number of conversations going on as we speak, and look for some announcements on our go-to-market plan in the not-too-distant future.