SoftBank's Vision Fund to Invest $2.25 Billion in GM Cruise
【Summary】General Motors announced today that the SoftBank Vision Fund will invest $2.25 billion in GM Cruise to support the company’s plans to commercialize autonomous vehicle technology at large scale. GM will also invest $1.1 billion in GM Cruise upon closing of the transaction.
DETROIT — Cruise Automation, the self-driving startup that General Motors purchased for over $1 billion in 2016, is getting another major investment of $2.25 billion from Softbank's Vision Fund.
GM (NYSE: GM) announced today that the SoftBank Vision Fund will invest $2.25 billion in GM Cruise Holdings LLC (GM Cruise), to support the company's plans to commercialize AV (autonomous vehicle) technology at large scale. GM will also invest $1.1 billion in GM Cruise upon closing of the transaction, making the total new investments in Cruise over $3.25 billion.
In March 2016, GM announced that it was buying self-driving startup Cruise Automation for over $1 billion in cash and stock. The company is based in San Francisco. Together, the two companies are working on a commercial autonomous ride-hailing service. At the time, the move was an effort by GM to jumpstart its own self-driving car technology.
"Our Cruise and GM teams together have made tremendous progress over the last two years," said GM Chairman and CEO Mary Barra. "Teaming up with SoftBank adds an additional strong partner as we pursue our vision of zero crashes, zero emissions and zero congestion."
"GM has made significant progress toward realizing the dream of completely automated driving to dramatically reduce fatalities, emissions and congestion," said Michael Ronen, managing partner, SoftBank Investment Advisers. "The GM Cruise approach of a fully integrated hardware and software stack gives it a unique competitive advantage. We are very impressed by the advances made by the Cruise and GM teams, and are thrilled to help them lead a historic transformation of the automobile industry."
"We're excited to be joining forces with a tech leader who shares our belief that AV technology will change the world," said GM President Dan Ammann. "We look forward to partnering with SoftBank as we work toward deploying this technology safely and in massive scale."
A Bolt AV without a steering wheel or pedals that GM hopes to mass produce
The Softbank Vision Fund, started in 2017, is seeking a target fund size of $100 billion. The fund invests in emerging technologies including self-driving cars. Its partners include Apple, Foxconn, Sharp, and Saudi Arabia's Public Investment Fund.
The SoftBank Vision Fund investment will be made in two tranches. At the closing of the transaction, the Vision Fund will invest the first tranche of $900 million. When Cruise is ready to deploy a commercial fleet of autonomous vehicles, the Vision Fund will complete the second tranche of $1.35 billion. The investments are subject to regulatory approval.
Together, this will result in the SoftBank Vision Fund owning a 19.6-percent equity stake in GM Cruise.
The GM and SoftBank Vision Fund investments are expected to provide the capital necessary to reach commercialization of an autonomous ride-hailing service at scale beginning in 2019. Cruise has been testing and operating a fleet of self-driving Chevy Bolt EVs in San Francisco for the past year. GM plans to mass produce the self-driving Bolts.
GM is seeking approval to build the cars without a steering wheel or pedals. The automaker has petitioned the federal government for approval to adjust 16 motor vehicle standards so it can test autonomous cars that have no steering wheel, pedals and other driver controls.
In addition to the GM Cruise investment, Softbank is also the largest shareholder in Uber.
Last December, Softbank closed on its 15 percent stake in the ride-hailing company. The deal includes a large purchase of shares from existing Uber investors and employees at a discounted valuation for the company of $48 billion as well as a $1.25 billion cash investment directly in Uber.
Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.
XPeng’s Urban Air Mobility Affiliate HT Aero to Raise $500+ Million in Series A Funding Round
iPhone Assembler Foxconn Unveils 3 New Electric Vehicle Prototypes as it Prepares to Diversify its Business by Building EVs
BMW i Ventures Invests in Michigan-based EV Battery Startup ‘Our Next Energy Inc.’
Commercial Vehicle Startup Electric Last Mile Solutions Inc. Announces Battery Supply Agreement with China’s CATL
Honda Unveils its New ‘SENSING 360’ Omnidirectional Safety & Advanced Driver Assist System
Aviation Startup Lilium and ABB Announce Plans to Build a MegaWatt eVTOL Charging Network
Lucid Reveals New Details of its ‘DreamDrive’ Advanced Driver Assist System, its Answer to Tesla’s Autopilot
Tesla Sold 56,000 China-made Vehicles in September, the Highest Since its Shanghai Factory Began Producing Cars in 2019
- German Vehicle Tuner Manhart Performance Reveals the 543 HP Tesla Model 3, its First EV Project
- Lidar Startup Quanergy Demonstrates an Industry-First Optical Phased Array Lidar Sensor with a 100 Meter Range
- Apple's Next iPhone Will Reportedly Be Able to Connect to Satellites, Can Tesla’s Vehicles Do the Same?
- Ford Motor Co Renews $15.5 Billion in Revolving Credit Lines, Aligning Them With its Updated Sustainability Goals
- The Biden Administration Asks Automakers to Back its Pledge of 40% of New Car Sales Being Electric by 2030
- Electric Truck Startup Rivian Plans to Raise up to $8 Billion in its Upcoming IPO
- Hydrogen-Electric Truck Maker Nikola Corp Announces Major Fuel Cell Production Agreement with Bosch
- Ford Mustang Mach-E Hit by Another Delay
- General Motors Confirms New Commercial Electric Truck and Van
- The Volkswagen ID.4 Will Come With These 10 Intelligent Features