Picture: 123RF/MIKKO LEMOLA
Picture: 123RF/MIKKO LEMOLA

General Motors  and Microsoft   are leading a $2bn investment round in self-driving car start-up Cruise  in a deal that will bring the software giant’s cloud and edge-computing capabilities to the venture.

The new funds will raise Cruise’s post-investment valuation to an estimated $30bn, up from $19bn when T Rowe Price Associates  invested in the company in 2019, Cruise said. Cruise partner Honda Motor   and other institutional investors are also participating in the new round.

The partnership with Microsoft gives Cruise, which is majority owned by GM, a major software player in its corner. That will help the company compete with Waymo, which has access to the software capabilities of parent Alphabet.

Shares of GM surged 8.6% to $54.28 in New York. Microsoft rose 0.4% to $213.52.

Cruise will be able to use Microsoft’s Azure cloud-computing platform to manage its self-driving vehicle network. Azure will handle data and mapping, as well as enable cars to communicate with Cruise’s back office and customer-facing app for ride-hailing. It’s a vital piece of software infrastructure that Cruise needs to build its planned commercial robotaxi service.

“Our mission to bring safer, better and more affordable transportation to everyone isn’t just a tech race — it’s also a trust race,” Cruise CEO Dan Ammann said. “Microsoft, as the gold standard in the trustworthy democratisation of technology, will be a force multiplier for us as we commercialise our fleet of self-driving, all-electric, shared vehicles.”

Cruise is preparing to start charging fares for its service in San Francisco later in 2021.

Bloomberg

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