GM's Cruise Secures US$ 1.15 Billion of Additional Funding
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GM's Cruise Secures US$ 1.15 Billion of Additional Funding

By IndraStra Global News Team

On May 7, 2019, San Francisco-based Cruise Automation (largely owned by General Motors) announced an equity investment of US$ 1.15 billion from a group comprising institutional investors, including funds and accounts advised by T. Rowe Price Associates, Inc., and existing partners General Motors, SoftBank Vision Fund, and Honda Motors Company Limited. The company is working towards creating the world’s first scalable autonomous vehicle (AV) fleet.

"Developing and deploying self-driving vehicles at massive scale is the engineering challenge of our generation," said Cruise CEO Dan Ammann. "Having deep resources to draw on as we pursue our mission is a critical competitive advantage."

This investment increases Cruise's valuation to US$ 19.0 billion, inclusive of US$ 2.25 billion by SoftBank's Vision Fund which was previously announced in May 2018. The new investment roughly 30 percent of GM’s total valuation, despite not having a single product in the market. In the last year, Cruise has secured capital commitments totaling US$ 7.25 billion, which places it in the top tier of AV fund-raisers.

Currently, Cruise's headcount sits at 1,200 as it has accelerated its hiring from a small startup of 40 people.  The company plans to hire 200 engineers in Seattle and also boost its overall manpower to 1,000 engineers by the end of the year.

Cruise is not alone

A number of self-driving technology developers have announced raising good investments within the past six months.

1. Ford’s owned autonomous-vehicle startup Argo AI is at a US$ 4 billion valuation after raising US$ 1.7 billion from Volkswagen.

2. Softbank and Honda poured US$ 1 billion into Uber’s self-driving, to push the company’s Advanced Technology Group to US$ 7.3 billion in valuation.

3. Softbank also invested US$ 940 million on the robot delivery startup Nuro, now valued at US$ 2.7 billion.

4. Elon Musk's Tesla recently announced it would raise US$ 2.7 billion to support plans of producing fully functioning self-driving software by 2020.

5. Google spinoff Waymo spends roughly US$ 1billion yearly developing autonomous vehicles. The company plans to seek outside financing to match its own hefty spending.