Select Page

GM Surges After Its Self-Driving Startup Ropes In $2 Billion From Microsoft

GM Surges After Its Self-Driving Startup Ropes In $2 Billion From Microsoft

GM stock is surging to start the shortened trading week after news that Microsoft is investing in the company’s driverless car startup, Cruise. The stock is up about 8% in early trading on Tuesday.

Microsoft is part of a group of companies that will invest more than $2 billion in Cruise, which is majority owned by GM, according to the Wall Street Journal. The stakes in Cruise raise its valuation to $30 billion, up from $19 billion in Spring 2019.

GM is also adding to its Cruise investment as part of the funding round and is going to maintain its majority stake. Among other companies investing is Honda, who is already a stakeholder, and “other institutional investors”. Cruise had previously pulled in $7 billion during 2018 and 2019 from investors that included Softbank. 

The terms of the deal state that Cruise will use Microsoft’s Azure cloud service to help it roll out autonomous vehicle services. Cruise has been testing vehicles in San Francisco and plans on rolling out a robot-taxi service eventually. Meanwhile, Tesla’s promise of “a million robo-taxis” on the road seems to be a distance memory. 

GM also noted that Microsoft is going to be its preferred cloud provided and will help streamline the company’s supply chains. Cruise has signaled that it is getting “closer to commercializing its technology” at the same time investor appetite in EVs and self-driving seems to have reached mass adoption. 

As The Journal notes, self-driving companies are seeing profound bumps in their respective valuations:

Startup Aurora Innovation Inc. had a valuation of around $10 billion following its recent acquisition of Uber Technologies Inc.’s autonomous unit, up from about $2.5 billion in 2019. The market value of Luminar Technologies Inc., which makes laser-based sensing technology for self-driving cars, has rocketed to around $10 billion following its initial public offering last month. Waymo LLC, the autonomous-vehicle division of Google parent Alphabet Inc., raised at least $3 billion last year and recently began providing rides to the general public in the Phoenix area.

This marks the first major investment round in Cruise in more than 18 months.

GM is surging on the news, as we noted – but the biggest question becomes whether or not the legacy automaker’s tie up with a major tech giant and pivot to self-driving could see its stock catch the same euphoria that has pushed certain other auto stocks into the stratosphere…

Tyler Durden
Tue, 01/19/2021 – 09:30


This post has been republished with permission from a publicly-available RSS feed found on Zero Hedge. The views expressed by the original author(s) do not necessarily reflect the opinions or views of The Libertarian Hub, its owners or administrators. Any images included in the original article belong to and are the sole responsibility of the original author/website. The Libertarian Hub makes no claims of ownership of any imported photos/images and shall not be held liable for any unintended copyright infringement. Submit a DCMA takedown request.

-> Click Here to Read the Original Article <-

About The Author

Tyler Durden

Zero Hedge's mission is to widen the scope of financial, economic and political information available to the professional investing public, to skeptically examine and, where necessary, attack the flaccid institution that financial journalism has become, to liberate oppressed knowledge, to provide analysis uninhibited by political constraint and to facilitate information's unending quest for freedom. Visit https://www.zerohedge.com

Leave a reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Welcome

Bringing together a variety of news and information from some of today’s most important libertarian thought leaders. All feeds are checked and refreshed every hour and pages auto-refresh every 15 minutes. External images are deleted after 30 days.

Time since last refresh: 0 second

Publish Your Own Article

Follow The Libertarian Hub

 

Support Our Work

Support the Libertarian Hub by tipping with Bitcoin!

Send BTC:
19PU2K7448gKxAvisR5cF6X5RquYfWu5vZ

Weekly Newsletter

Newsletter Signup

Subscribe to our newsletter to receive a weekly email report of the top five most popular articles on the Libertarian Hub!

Weekly Newsletter SignupTop 5 Stories of the Week

Subscribe to our newsletter to receive a weekly email report of the top five most popular articles on the Libertarian Hub!