Microsoft (MS), the world’s largest software company, decided to develop an autonomous vehicle with General Motors (GM), the largest automaker in the United States. Microsoft is making large-scale investments in Cruise, a subsidiary of GM’s autonomous driving technology development, to discover next-generation food.
According to the Wall Street Journal (WSJ) on the 19th (local time), Microsoft announced that it will invest in a new stake as one of the strategic collaborations on Cruise with GM, Japanese Honda Motor Company, and institutional investors. The total investment amount is 2 billion dollars (about 2.2 trillion won). The size of Microsoft’s own investment is unknown.
Accordingly, Cruise will launch an autonomous vehicle service by actively utilizing Azure, Microsoft’s cloud computing platform. This is because in order to commercialize an autonomous vehicle, the ability to collect, store, and process vast amounts of data must be supported. Azure is evaluated as a platform that has been proven in the industry for its stability, as it is applied to autonomous vehicles by major automakers such as Volkswagen of Germany and Toyota of Japan. “The participation of MS will help Cruise commercialize the technology,” said Dan Aman Cruise, CEO. Microsoft CEO Satia Nadella said, “Microsoft wants to contribute to self-driving cars becoming mainstream.”
GM said it will accelerate the development of driverless vehicles through Microsoft’s equity investment in Cruise. A GM official said, “By collaborating with MS, we plan to accelerate digital initiatives of automakers, including artificial intelligence (AI), and this will be an opportunity to quickly provide new mobility services.” WSJ analyzed Microsoft’s investment as a sign that interest in autonomous driving technology has resumed. If Microsoft’s investment becomes a reality, Cruise’s corporate value will soar from $19 billion to $30 billion. It is similar to Google’s subsidiary Waymo, which is considered a leader in autonomous driving.
Since GM is investing money for this investment, it still maintains its position as a major shareholder. Earlier, GM acquired Cruise in March 2016 for about $1 billion. Before it was acquired by GM, Cruise steadily attracted attention, attracting 20 million dollars of investment from Spark Capital and Maven Ventures. Founder, CEO Kyle Vogt, worked as co-founder of Twitch, a live game service, before launching Cruise, which was acquired by Amazon in 2014 for $970 million.
Cruise has been testing self-driving cars in the area around San Francisco, where its headquarters are located, for years. It is also planning to provide a robotic taxi service on a pilot basis, and it is also opening up the possibility of commercial delivery services.
GM CEO Mary Barra has been investing heavily in this field for several years, betting the future of electric vehicles, connected cars and autonomous vehicles. The market is also positively evaluating GM’s growth strategy. When the news of the investment was delivered on the same day, GM stock price surged 9.7%. GM’s share price jumped 14% last year and rose 20% this year. Self-driving vehicle technology is a field where large information technology (IT) companies, traditional automakers, and automotive technology related companies have been making investments in recent years. Google has been testing self-driving cars through Waymo for many years, and Amazon, the world’s largest e-commerce company, acquired the self-driving company ZOX last year. Apple is negotiating with Hyundai Motor Company regarding self-driving electric vehicles.
Reporter Kim Jung-eun [email protected]
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