Last year, GM said it had “aggressive” plans to develop autonomous vehicle technology; now it’s following up on that promise with its planned purchase of Cruise Automation. Talks between the two initially centred on a new round of venture capital, only for the focus to turn to a full blown acquisition. Financial details are scant, but Fortune quoted a source as saying the deal is valued at “north of $1bn,” made up of a combination of cash and stock.
Cruise Automation has raised over $18m in venture capital funding over its three years in existence
The acquisition is in keeping with GM’s decision earlier this year to invest $500m in Lyft and create a connected network of self-driving cars. GM’s President Dan Ammann said at the time: “We see the future of personal mobility as connected, seamless and autonomous.” This latest announcement is proof the ambition remains.
San Francisco-based Cruise Automation has raised over $18m in venture capital funding over its three years in existence and is best known for creating an aftermarket kit that turns standard vehicles into autonomous ones. “The next step is to make sure we bring the full resources to the table to accelerate what Cruise is doing and integrate into the GM vehicle system”, Ammann told TechCrunch.
The acquisition isn’t expected to close until the year’s second quarter, but, once completed, it could accelerate GM’s plans to develop a driverless fleet. With Uber, Google and Apple as competition, the acquisition could hand GM a much-needed advantage.