Microsoft backs Cruise as part of $2B funding round

0
258
Cruise just got Microsoft as a partner as part of a $2 billion funding round.
Image: Cruise

Autonomous vehicles are gaining a ton of traction thanks to the fact that multiple companies are nearly ready to roll out self-driving systems for commercial use. Whether it’s for transporting packages or people, self-driving technology will have a major impact on the world in the coming decade.

General Motors’ driverless car unit, Cruise, now has another major partner. On Tuesday, Microsoft threw its support behind the spinoff company as part of a $2 billion funding round, Ars Technica reports. The latest funding brings Cruise’s total valuation to a whopping $30 billion.

Working Together

Until this point, Microsoft hasn’t been directly involved in the self-driving vehicle space. The Big Tech firm has focused on other areas and even runs a “connected car” segment. It supplies smart services to traditional carmakers like Volkswagen, BMW, and Ford, Ars Technica reports. However, it’s been impossible to miss the buzz surrounding the autonomous driving industry.

Advertisement
Manage your supply chain from home with Sourcengine

It was inevitable that Microsoft would join in at some point. Now, its support will help Cruise compete head-to-head with Google’s spinoff company Waymo. The latter is also reportedly worth upwards of $30 billion thanks to a $3.2 billion cash injection it received last year.

Both Cruise and GM will utilize Microsoft’s suite of Azure cloud services to help run their operations. Satya Nadella, the company’s CEO, says that this will “help them scale and make autonomous transportation mainstream.”

Although it isn’t clear exactly what this entails, the results are sure to be impressive. Given the size of a company like GM, having the backing of Microsoft’s software solutions is instantly a major advantage.

Investors, like many analysts, seem to like the news. GM’s shares jumped by 9.75 percent on Tuesday following the announcement.

GM CEO Mary Barra said in a statement that the company will “realize even more benefits from cloud computing as we launch 30 new electric vehicles globally by 2025 and create new businesses and services to drive growth.”

Cruise Control

As it was for most businesses, 2020 was a difficult year for Cruise. The COVID-19 pandemic forced it to temporarily halt its self-driving tests for several months. Later in the year, it was deemed an “essential service” in San Francisco, allowing it to resume testing.

While many of Cruise’s plans remain shrouded in mystery, the company has shown promising signs in recent times. For instance, it signed a deal with Walmart in November to make contact-free deliveries in the Scottsdale, Arizona, area.

Meanwhile, Cruise originally planned to roll out an autonomous rideshare service using its all-electric Origin vehicle. The Origin looks more like a train car than a passenger car and doesn’t have a steering wheel or pedals. Instead, passengers relax in a lounge-like interior while the pod drives around on its own.

For now, Cruise has indefinitely put its plans for a rideshare service on hold. It’s unclear what the holdup is, but it is likely related to safety regulations that have yet to be established for the self-driving car industry.

Even so, it will be interesting to see where Cruise, as well as its competitors, end up in 2021 and beyond. Operations for these companies will ramp up as the pandemic starts to resolve, which means some exciting progress could finally be made this year. For Cruise, Microsoft’s backing will certainly help.

LEAVE A REPLY

Please enter your comment!
Please enter your name here