Oct 4, 2018

Honda to invest $2.8bn in GM's self-driving car unit

Honda will invest $2.75bn and take a stake in General Motors self-driving unit, GM Cruise, as firms continue to team up in the race to develop autonomous vehicles. The Japanese carmaker said it wants develop a self-driving car that could be manufactured at high volume. Honda's shares were up 1.2% in early Tokyo trade following the announcement and GM's shares rose 2.1% in the US. Honda will contribute approximately $2bn over 12 years to self-driving vehicle initiatives, which together with a $750m equity investment in Cruise, brings its total commitment to the project to $2.75bn, the two firms said in a statement. Honda's investment in GM Cruise, together with Softbank's recent investment, values the firm at $14.6bn. GM was criticised for overpaying for it when it bought a majority stake in the start-up two years ago for $1bn. Founded by engineer Kyle Vogt in 2013, San Francisco-based Cruise developed Chevy's first driverless cars, some of which are still on the roads in the US. Amid the many concerns over the safety of autonomous vehicle technologies, GM Cruise argues the technology they are working on allows self-driving cars to see more than a human driver would. "We see more of what is going on around the car at any given time than a driver can," GM Cruise said.

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