September 4—Uber and Yandex, the Russian counterpart to Google, announced plans to turn their self-driving car venture into a new company. As part of the deal, the Eastern European brand is assuming a controlling stake in the business, now called Yandex Self-Driving Group B.V (Yandex SDG).
Though not as prominent as some autonomous vehicle projects, the firm’s prospects look very strong.
Uber and Yandex’s New Self-Driving Card Subsidiary
In a press release, Yandex and Uber explained their new self-driving company is being spun-out from their pre-existing venture, MLU B.V. In 2018, the two brands combined forces to launch ride-hailing and food delivery products in Russia and six other nations.
Under that arrangement, Uber and Yandex claim to have started the first European-based robotaxi service.
Yandex Self-Driving Group will see the forward-looking venture between the two brands continue under slightly different terms. From now on, Yandex will control 73 percent of the autonomous vehicle firm while Uber will hold a 19 percent stake. The corporation will distribute the remaining 8 percent of Yandex SDG’s shares to its managers and staffers.
Yandex is also buying out some of Uber’s interest in MLU, which brings its ownership share to 61.7 percent. As a result, Uber’s stake in the business will fall to 33.5 percent, down from 37 percent in June.
The Russian search engine company will also pour $150 million into the new self-driving brand. The new firm will spend its capital infusion on research and development, as well as productization of the venture’s autonomous vehicle technology.
Previously, Yandex had invested around $65 million into its next-generation car project.
Yandex SDG has Real Potential
At present, brands like Tesla and Google’s Waymo are widely considered leaders in the self-driving car sector. However, thanks to its shrewd strategy and aggressive development, Yandex SDG could become a real player in the industry.
As opposed to some competitors, the new company is not focused entirely on deploying a robotaxi fleet.
The corporation is interested in selling its autonomous vehicle assets to other brands. In March 2019, Yandex inked an agreement with Hyundai to develop hardware and software for the automotive giant’s cars. The deal requires the firm to produce a universally accessible self-driving car platform for Hyundai.
The company, now named Yandex SGD, also created Yandex.Rover, an autonomous robot designed to transport food and packages.
In addition, the Eastern European conglomerate made some impressive strides with its autonomous vehicle segment. The division’s fleet of 130 self-driving cars operates in Israel, Russia, and the United States. So far, Yandex SDG’s automobiles have racked up over 4 million miles driving in multiple cities and varying weather conditions.
Last month, the company released a video showing one of its cars moving through Tel Aviv’s streets and highways for 35 minutes without driver intervention.
The Information estimates 30 companies have spent a combined $16 billion in developing autonomous vehicle technology without significant success. However, a 2017 study predicts the theoretical self-driving car market will be worth $7 trillion a year annually. Given its impressive results so far, Yandex and Uber’s joint solution may be able to access that massive revenue stream at a relative bargain.