Home / Business / SoftBank, Toyota lead $1 billion funding round in Uber unit

SoftBank, Toyota lead $1 billion funding round in Uber unit

SAN FRANCISCO: Uber’s autonomous vehicle unit has raised $1 billion from a consortium of investors including SoftBank Group Corp, giving the company a much-needed funding boost for its pricey self-driving ambitions on the eve of its public stock offering.

Uber Technologies Inc said on Thursday that the investment values its Advanced Technologies Group, which works to develop autonomous driving technology, at $7.25 billion. SoftBank will invest $333 million from its $100 billion Vision Fund, while Toyota Motor Corp and automotive parts supplier Denso Corp will invest a combined $667 million.

Toyota will also contribute up to an additional $300 million over the next three years to help cover the costs of building commercial self-driving vehicles, Uber said.

Uber CEO Dara Khosrowshahi said that the funding “will help maintain Uber’s position at the forefront of” a transforming transportation industry. The funding allows Uber to transfer some of the substantial cost of developing self-driving cars onto outside investors. That is likely to appease some of Wall Street’s concerns over Uber’s spending on the autonomous unit, which has topped $1.07 billion since the program started in 2016.

In its filing for an initial public offering this month, Uber cautioned that development of self-driving technology “is expensive and time-consuming and may not be successful” and the company lagged certain competitors. The self-driving business unit brings in no meaningful revenue for Uber, which last year lost $3.03 billion.

A s part of the investment, ATG becomes its own legal entity but remains under the control of Uber. A new ATG board will be formed, with six directors appointed from Uber, one from SoftBank and one from Toy ota. reuters

News credit : Indiatimes