General Motors' self-driving car business (GM Cruise) has been given a huge vote of confidence by SoftBank Vision Fund.
The fund, which controls more than $100 billion in assets and is considered the world's biggest tech investor, on Thursday announced it will inject $2.25 billion in GM Cruise in return for a 19.6 percent stake.
An initial payment of $900 million will be made directly with the remainder to paid out when GM Cruise's self-driving cars are ready for commercial deployment, currently estimated to be in 2019.
As part of the deal, GM will also invest $1.1 billion in GM Cruise upon closing of the transaction.
Chevrolet Cruise AV self-driving car
“GM has made significant progress toward realizing the dream of completely automated driving to dramatically reduce fatalities, emissions and congestion,” SoftBank investment adviser Michael Ronen said in a statement. “The GM Cruise approach of a fully integrated hardware and software stack gives it a unique competitive advantage."
GM is one of the more ambitious players in the self-driving car space. It's first self-driving car, the Chevrolet Bolt EV-based Cruise AV is completely devoid of a steering wheel and pedals. The cars will be start production at GM's Orion Township plant in Michigan next year, though it isn't clear yet where they will be deployed. Likely locations will be where GM currently tests the cars. The list includes downtown San Francisco, as well as Scottsdale, Arizona and Warren, Michigan. GM also plans to start testing prototypes in Manhattan soon.
GM's closest rival when it comes to self-driving cars is Waymo, which plans to commercialize self-driving cars this year. The first service is expected to cover about 100 square miles in Phoenix, Arizona.
SoftBank Vision Fund is part of Japanese holding company SoftBank, which is a major investor in ride-sharing firms. In fact, it is the biggest single shareholder in both Uber and Southeast Asian ride-sharing giant Grab. Via its multiple investments, it's poised to become a dominant player in the future self-driving taxi market.
