GM, Honda strike deal to build self-driving cars

By AutoFOXBusiness

GM shares surge on investment from Japan's SoftBank

FBN's Stuart Varney on SoftBank's investment in General Motors' self-driving fleet.

General Motors announced on Wednesday that Honda will invest in the company’s self-driving car unit, Cruise, as part of a deal to jointly develop driverless technology.

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Honda will work with GM on a purpose-built autonomous vehicle for Cruise, and the rival automakers will explore ways to deploy the Cruise network globally. The companies said their self-driving vehicle will be designed for high-volume production.

Under terms of the agreement, Honda will invest $750 million in Cruise and spend $2 billion over 12 years. GM said Honda’s equity investment, in addition to a recent investment from Japan’s SoftBank, values Cruise at $14.6 billion.

“Together, we can provide Cruise with the world’s best design, engineering and manufacturing expertise, and global reach to establish them as the leader in autonomous vehicle technology – while they move to deploy self-driving vehicles at scale,” GM CEO Mary Barra said in a statement.

In June, GM and Honda reached a deal to collaborate on advanced batteries used in electric vehicles. They also work together on fuel-cell vehicles.

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“Honda chose to collaborate with Cruise and General Motors based on their leadership in autonomous and electric vehicle technology and our shared vision of a zero-emissions and zero-collision world,” Seiji Kuraishi, Honda’s executive vice president and representative director COO, said in a statement.

TickerSecurityLastChange%Chg
GMGENERAL MOTORS COMPANY35.11-0.57-1.60%
HMCHONDA MOTOR27.23-0.03-0.11%

SoftBank acquired a 20 percent ownership stake in Cruise for $2.25 billion earlier this year, providing the GM division with funding that will support the rollout of a driverless taxi service in 2019. GM has said it plans to begin producing Chevrolet Bolt electric cars with no pedals or steering wheels next year.

Ford plans to launch its own fleet of self-driving taxis in 2021. Waymo, Google’s autonomous vehicle business, has agreed to buy thousands of minivans from Fiat Chrysler to support a pilot program.

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