Uber will reportedly spin off its self-driving car business after securing $1 billion in funding from Toyota, Denso, and Softbank.
According to Tech Crunch, Toyota and automotive parts supplier Denso are providing $667 million in investment to the Uber Advanced Technologies Group (Uber ATG), while Softbank’s Vision Fund will throw in an additional $333 million. The deal is expected to close in the third quarter of this year and comes just a few weeks before Uber’s initial public offering.
Following the investment, Uber ATG has been valued at $7.25 billion and will be spun off from the main Uber business which focuses on ride-hailing. Not only will this help the company cut back on its losses, but it should ensure that its division has greater freedom to explore the world of autonomous vehicles.
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"Leveraging the strengths of Uber ATG’s autonomous vehicle technology and service network and the Toyota Group’s vehicle control system technology, mass-production capability, and advanced safety support systems, such as Toyota Guardian, will enable us to commercialize safer, lower cost automated ridesharing vehicles and services," Toyota executive vice president of the firm’s connected company division, Shigeki Tomoyama, said in a statement.
Softbank and Toyota have already committed a lot of money to Uber. In January 2018, Softbank invested $1.2 billion, while in August 2018, Toyota put $500 million into the company. Softbank and Toyota also happen to be jointly developing various services in Japan, and Toyota and Uber are also developing self-driving Siennas together.