SoftBank Vision Fund will invest $2.25 billion in GM Cruise Holdings, the automaker’s self-driving car unit, to help commercialize GM’s autonomous vehicle technology in a large-scale fleet starting next year.
GM is also investing $1.1 billion in GM Cruise, strengthening its commitment to bringing self-driving cars to market in a big way.
“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.”
SoftBank Vision Fund, a $100 billion technology investment fund owned by Japanese internet and mobile phone carrier SoftBank, has become a major player in the future of transportation, with substantial stakes in ride-hailing firms Uber, Didi, Ola and Grab, as well as semiconductor companies Nvidia and ARM, and mapping company Mapbox. But its investment in GM “is as big as it gets,” said Michael Ronen, managing partner of SoftBank Investment Advisers. The $2.25 billion stake will give SoftBank Vision Fund a 19.6% stake in the GM autonomous-vehicle subsidiary.
Ronen said “we were blown away” by the speed at which GM Cruise has been able to integrate autonomous-vehicle technology into mass-produced vehicles. SoftBank was also convinced that GM, with its 100-year history of producing automobiles, would deploy AV technology safely, and at scale, successfully.
“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.”
GM President Dan Ammann said the automaker is excited to join forces with a tech leader that shares GM’s view of how AV technology will change the world and reiterated that GM won’t launch its self-driving cars until the company is convinced it can do so safely.
The deal is subject to regulatory approval. SoftBank Vision Fund will invest $900 million when the deal closes in the second quarter, and the remaining $1.35 billion when Cruise AVs are ready for commercial deployment, expected in 2019.
The deal is for seven years, which Ronen said “is a good benchmark for what we think is the runway for this technology to get at least close to maturity,” adding that there is a lot of growth ahead.
