Money is currently pouring into dozens of companies trying to bring self-driving car technology to market.
GM is betting on its own self-driving car division as it secures over $3 billion in backing to bring the technology to market next year.
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In 2016, GM stepped into the autonomous driving scene in a big way by acquiring Cruise Automation, a startup with Tesla Autopilot engineering talent and founded by Twitch co-founder Kyle Vogt.
At the time, the startup didn’t have much more than a rough prototype, but self-driving startups were being acquired left and right and GM ended up paying ~$1 billion for Cruise. Tesla referred to what GM was acquiring as ‘little more than demoware’.
But GM has since put a lot of money into the startup to hire hundreds of engineers and it plans to hire hundreds more.
They made some significant progress based on an impressive real-world self-driving demo of their Bolt EV prototype of which they now have over 100 driving in California, Arizona, and Michigan.
They are already using part of their fleet to carry Cruise employees “anywhere in San Francisco using their app” – an early version of the service they plan to offer to the public next year.
Now to finance this commercialization plan, GM is taking an outside investment into its self-driving division.
The automaker announced that SoftBank Vision Fund will “invest $2.25 billion in GM Cruise Holdings LLC (GM Cruise), while GM will also invest $1.1 billion in GM Cruise.
GM Chairman and CEO Mary Barra made the announcement:
“Our Cruise and GM teams together have made tremendous progress over the last two years. Teaming up with SoftBank adds an additional strong partner as we pursue our vision of zero crashes, zero emissions and zero congestion.”
SoftBank will first release a $900 million tranche of investment along with GM’s own contribution.
The company believes that it will be enough to get ready for the commercialization of their self-driving service and when it is ready, SoftBank will release the rest of its investment in order to accelerate the deployment. At that point, Softbank would own about 20% of GM Cruise.
Earlier this year, GM also unveiled the new autonomous Bolt EV interior without a steering wheel or pedal that they plan to produce next year.