Intel Chief Executive Officer Brian Krzanich speaks at a news conference in Munich, Germany, on Friday, July 1, 2016. BMW Group, Intel and Mobileye are announcing a partnership among the three companies to work together with the goal of bringing highly and fully automated driving into production by 2021. (Credit: BMW Group)

If you ever needed convincing that driverless cars were a thing then Intel’s latest acquisition should help you understand the scale of the growing industry.

The tech giant announced yesterday that it was purchasing Mobileye, a company specialising in autonomous driving tech, for a whopping $15bn.

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This is the biggest deal in the driverless car industry and only Intel’s second-largest deal ever in the company’s 49-year history.

Mobileye creates vision-based driver assistance systems. It works by mounting Mobile-eye based devices on a dashboard, and the software interprets a video feed in real-time to detect what is on the roads and the car’s distance from it.

This could be other cars on the road or pedestrians crossing the road and the device will send out warning signals if there is an issue ahead.

However, the technology needs to be used in conjunction with a driver, which can be alerted to the upcoming issues. This is where a company, such as Intel, can come in and take advantage of Mobileye’s vision software to boost its autonomous driving offering.

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In an email to Intel’s employees, the company’s chief executive Brian Kzanich said the acquisition “essentially merges the intelligent eyes of the autonomous car with the intelligent brain that actually drives the car”.

When it went public back in 2014, Mobileye was the largest-ever IPO by an Israeli firm. It raised $890m at a valuation of over $7.5bn. Its EyeQ chips and cameras are installed in around 15m vehicles and it has partnerships with 25 carmakers, including Tesla, which gives it a dominant position in the market.

The acquisition of the Israeli startup by Intel is an opportunity for the tech company to tap into the estimated $70bn autonomous driving market. Kzanich said:

“The combination of Intel’s high performance computing and connectivity solutions with Mobileye’s best in class computer vision technology will put us in a position to accelerate innovation for car-makers and lead in delivering the technology foundation for highly and fully autonomous driving.”

Ziv Aviram, Mobileye’s cofounder and chief executive, said in a statement:

“By pooling together our infrastructure and resources, we can enhance and accelerate our combined know-how in the areas of mapping, virtual driving, simulators, development tool chains, hardware, data centers and high-performance computing platforms. Together, we will provide an attractive value proposition for the automotive industry.”

For now though, the two companies will remain separate entities until the transaction closes, expected to be within the next nine months.