Mercedes-Benz spins out Silicon Valley chip group into new company

By Stephen Nellis

SAN FRANCISCO (Reuters) -Mercedes-Benz on Friday spun out into a new company a group of chip experts in Silicon Valley that is working on creating a new generation of computing brains for self-driving cars, drones and other vehicles.

Athos Silicon, based in Santa Clara, California, will house a group of engineers who for five years worked at Mercedes-Benz Research & Development North America to develop the new chips, which aim to be safe enough for use in cars while using less energy than existing chips. 

As part of the spinout, Athos is receiving intellectual property developed by the group and what Mercedes-Benz described as a "significant" investment, though neither the carmaker nor Athos disclosed the value of the transaction.

For chips used in cars, reliability is key, so critical self-driving functions are often handled by two or more separate chips in order to have backups in case of a failure. The Athos team developed a way to get the same kind of reliability using "chiplets," which are tiny pieces of chips that can be bound together in a single package.

Keeping the chips in a single package can use 10 to 20 times less power than having separate chips that must communicate with one another across a circuit board, Athos Silicon Chief Executive Charnjiv Bangar said in an interview on Friday. Those power savings are important in electric vehicles where the car's computing brains must compete with its wheels for limited battery power.

"For an electric future, electricity is a new currency," Bangar said.

Athos Silicon intends to raise venture capital from other investors. Bangar declined to disclose Mercedes-Benz's precise stake, but said the carmaker will be a minority shareholder and the chip firm will have an independent board.

"Independence is important for Athos, so that we can reach out to other (carmakers), competitors of Mercedes. We need to make sure we have a neutral approach," Bangar said. 

(Reporting by Stephen Nellis in San FranciscoEditing by Nick Zieminski)