Toyota-backed Autonomous Driving Startup Pony.ai Closes on the First of its Series D Funding, Valuation Climbs to $8.5 Billion

author: Eric Walz   

Pony.ai is is outfitting robotaxis with autonomous driving technology in a partnership with Toyota.

The companies developing autonomous driving technology for automakers or mobility services continue to secure major investments. Among the U.S. leaders are Waymo and GM's unit Cruise. But in China, autonomous driving startup Pony.ai is quickly emerging as a leader in the field.

Pony.ai completed its first close on a Series D funding round, which combined with its previous funding, pushed its valuation to $8.5 billion. 

The company closed on a $367 million Series C funding round in Feb 2021, after a $100 million tranche was added to the $267 million Pony.ai raised in Nov 2020. The company also secured a $400 million investment from Toyota in Feb 2020.

Additional details of the Series D financing will be announced at the closing of the full round, the company said.

Although Pony.ai is headquartered in Guangzhou, China, the company was founded in 2016 in Fremont, California. The company's goal is to build the safest and most reliable autonomous driving technology. Pony.ai is one of eight companies, which includes Waymo and Cruise, that was issued a permit to test self-driving vehicles on public roads in California without a safety driver on board.  

In just a few years, Pony.ai has achieved technical milestones and significant progress toward commercialization of both robotaxis and self-driving trucks. The latest investments show investor confidence that Pony.AI will be able to scale its advanced autonomous driving technology.

"Our company has always been well funded, and this round funds development at Pony.ai several years into the future," said Lawrence Steyn, CFO of Pony.ai. 

Pony.ai said its proceeds from the funding round will be used to hire talent, fund research and development and expand global testing of its robotaxis and autonomous trucks, enter into additional strategic partnerships, and accelerate its path towards mass production and commercial deployment. Pony.ai plans to open up a number of new autonomous vehicle global testing and operation sites in 2022.

Pony.ai has been testing its robotaxi pilot service dubbed "PonyPilot'' since late 2018 in both Silicon Valley and Guangzhou, China. The company was the first to launch a robotaxi service in China and offer self-driving car rides to the general public. Pony.ai is planning to launch its robotaxi service in China using a fleet of self-driving Toyota Sienna minivans.

To support its fleet of robotaxis, Pony.ai developed its own autonomous driving computing unit built on NVIDIA's powerful Orin system-on-a-chip (SoC). The processor is Pony.ai's 6th generation autonomous driving system and was designed for automotive-grade mass production. The first Toyota Sienna vehicles equipped with the system will begin road testing in China later this year.

This autonomous computing unit powered by NVIDIA DRIVE Orin will rapidly accelerate the roll-out of Level 4 autonomous driving capabilities, according to Pony.ai. 

Last year, Pony.ai announced that its newly designed perception platform was developed in collaboration with Volvo-backed lidar developer Luminar. The vehicles will integrate Luminar's Iris sensor.

Pony.ai's self-driving vehicles are capable of navigating through city traffic, obeying all traffic laws, including yielding to pedestrians and bicyclists.

"I am very proud to announce this first close of our Series D," said James Peng, co-founder and CEO of Pony.ai. "The success of this financing belongs to the entire Pony.ai team, who have made tremendous strides in achieving and exceeding our 2021 milestones. We are excited about our 2022 objectives and the rapid pace of our development toward autonomous mobility globally." 

In an interview with CNBC in Nov 2019, Peng predicted that fully autonomous vehicles that carry passengers in China will be a reality by 2024.

"If I have to give a number, I'll probably say in five years," said Peng at the time. "We'll definitely see a wide adoption of autonomous driving vehicles—fully autonomous driving vehicles—on the open roads."

Now well-funded, Pony.ai is getting closer to its goal.

Eric Walz

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.