GM autonomous unit Cruise valued at $19 bln in funding round

Daniel Fowler
May 9, 2019

Cruise LLC announced on Tuesday a 1.15 billion US dollars equity infusion from institutional investors as the General Motors' autonomous vehicle development unit pushes to launch a robo-taxi service sometime this year. Cruise raised $2.25 billion from the SoftBank Vision Fund and $2.75 billion from Honda past year.

Developing and deploying self-driving vehicles at massive scale is the engineering challenge of our generation. It comes in addition to $2.75 billion from Honda Motor Co. last October and $2.25 billion last May from Japanese tech firm investment firm SoftBank.

GM's Cruise business has secured new funding, bringing the company's value to $19 billion.

Cruise, founded in 2013, is developing self-driving technology for General Motors. The unit has received more than $7 billion in funding over the past year. Cruise now operates its driverless test cars in San Francisco, Arizona and the Detroit area. Waymo has been valued at between $25 billion and $45 billion by analysts, with Morgan Stanley suggesting the company could someday be worth $175 billion, more than any current automaker except Toyota. The unit's chief executive officer, former GM President Dan Ammann, is incentivized to arrange such a deal as part of his compensation package.

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Cruise is now testing vehicles on the road in California that it plans to put into commercial use by the end of 2019 as it looks to compete with similar efforts from Waymo, Uber and Tesla. The California-based EV maker is looking to keep its product development machine rolling, including making sure all of its vehicles have the capability to be fully self-driving, CEO Elon Musk said during the company's earnings call.

"Having deep resources to draw on as we pursue our mission is a critical competitive advantage". A motor vehicle, autonomous or not, can do so in a heartbeat.

GM plans to double Cruise's workforce to 1,000 employees this year, and it plans to spend $1 billion in 2019 to develop autonomous vehicles. The latter two previously committed substantial amounts of money to Cruise.

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