March 15, 2019 Comments (0) Views: 392 National News

$1B Investment Would Give Uber’s Self-Driving Unit a Tune-Up

Uber Technologies is in late-stage discussions with a group including SoftBank and Toyota on taking a $1-billion stake in Uber’s autonomous vehicle business. The investment would value the business at between $5 billion and $10 billion, Reuters reported, citing two people said to be familiar with the discussions.

Fortune reported that the $1-billion investment would represent a minority stake in Uber’s self-driving vehicle division, giving Uber some additional backup ahead of its planned IPO. An IPO could value the ride-hailing company at more than $100 billion.

SoftBank is already the largest investor in Uber Technologies overall, taking a 15% stake in the company last year for $7.7 billion. Toyota invested $500 million in the self-driving division this past August.

Investors are nervous about the division’s steep losses and lack of revenue, according to Fortune. They’ve been pushing Uber CEO Dara Khosrowshahi to spin off the self-driving division or seek outside investment.

SoftBank and Toyota have a separate, $17-million autonomous driving endeavor in Japan, known as Monet Technologies. SoftBank has also invested $2.25 billion in General Motors’ autonomous car unit, Cruise, which has also received funds from Honda Motor Co. Ltd.

Uber lost about $3.3 billion in 2018, Reuters reported. It’s betting on the success of a self-driving unit to reduce the need for paying drivers.

The challenges of developing autonomous vehicle technology have led to what Reuters called “previously unlikely alliances,” including Honda’s investment in the Cruise platform. Both Toyota and Uber are seen as lagging their rivals, such as Alphabet Inc.’s self-driving unit, Waymo.

Furthermore, Reuters reported, the technology came under greater scrutiny when one of Uber’s autonomous vehicles struck and killed a pedestrian in Arizona last year. Prosecutors declined to file charges.

News of investment talks into the Uber self-driving unit was first reported by The Wall Street Journal, which said a deal could be reached next month. SoftBank Group shares trading on the Tokyo Stock Exchange rose on the news, whereas Toyota’s stock was flat.

Read more at Reuters

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