General Motors and its self-driving subsidiary Cruise announced a new deal with Microsoft, aimed at speeding up the commercialization of self-driving vehicles.
Microsoft will contribute an undisclosed amount to a $2 billion investment round in Cruise that also includes GM, Honda, and other institutional investors.
The funding round brings Cruise’s valuation to $30 billion, despite still being in the development stage and not yet having any customers.
Microsoft and Cruise set to collaborate in a long-term strategic partnership
The long-term strategic partnership between Microsoft and Cruise will go beyond monetary investment. As part of the deal, Microsoft’s Azure will become Cruise’s preferred cloud platform, helping the automaker develop its storage, artificial intelligence, and machine-learning capabilities.
The Microsoft deal comes as GM is increasing its efforts to develop electric and autonomous vehicles. The automaker plans to invest $27 billion in self-driving and electric vehicles through 2025, and aims to have 30 EVs in its lineup by that year.
Last year, the firm commenced testing of vehicles without drivers in San Francisco, and unveiled a fully driverless concept vehicle called the Cruise Origin. It also recently launched a new logistics-focused business unit called BrightDrop.
Microsoft is the latest tech giant to invest in self-driving tech
Microsoft is the latest tech giant to invest in self-driving tech. Its involvement comes as a surprise, since unlike other tech giants like Amazon and Google, Microsoft made no effort to invest in self-driving tech. The investment in Cruise marks the software giant’s first major step into the autonomous-car craze.
“Advances in digital technology are redefining every aspect of our work and life, including how we move people and goods,” Microsoft CEO Satya Nadella said in a statement. “As Cruise and GMs preferred cloud, we will apply the power of Azure to help them scale and make autonomous transportation mainstream.”
GM shares rose as much as 9% to a record high Tuesday morning following the news of the deal.