The big picture: Argo AI started out as a small Pittsburg-based startup founded by former Uber engineers, but over the last few years, it's galvanized into one of the most important innovators in the world of autonomous cars. Its ambitions are to make robotaxis with Level 4 automation a reality by 2025, and become a publicly traded company by 2023.

Argo AI -- the autonomous car venture backed by Volkswagen and Ford -- is gearing up for the 2021 IAA Mobility event in Munich, where it will share more about its vision on the future of commercial robotaxi services.

One of the things that Argo AI is showing off is its all-electric ID. Buzz AD, where "AD" stands for autonomous driving. This is a test vehicle for a van concept and will be the first vehicle to be made by the Volkswagen group that will feature Level 4 autonomous driving tech. That means it should be able to drive independently most of the time, but will be restricted to a specific area by geofencing technology.

The new battery-powered vehicle is equipped with Argo AI's laser lidar sensors, radar, and several cameras that are governed by the company's proprietary AI. Volkswagen says the tests will be performed at Argo AI's research and development center in Neufahrn, as well as the latter company's closed-course track at the Franz Josef Strauss International Airport in Munich. Other certified autonomous vehicle companies can also use the test track, and there is a similar test track in Western Pennsylvania that Argo has been using over the past few years.

The two companies have big plans for the future, and they hope to be able to deploy the first commercial robotaxi service in Hamburg by 2025. The ride-pool system will be run by MOIA, a subsidiary of the VW Group that has experience in helping cities and public transport companies relieve inner-city traffic congestion.

A major engineering challenge has been to keep the powerful computing hardware onboard the new vehicle cool during operation, and the two companies are still working on the best placement for all the sensors to provide maximum visibility.

Competing with the likes of Alphabet's Waymo will be difficult, but Argo is among the best-funded autonomous driving companies out there. Ford and Volkswagen have already contributed a combined $3.6 billion into the company, and CEO Brian Salesky says an IPO can be expected within the next year. In the meantime, Argo and Ford are getting ready to launch no less than 1,000 self-driving vehicles on Lyft's ride-hailing network in several US cities in the coming years, including Miami and Austin.