Home Business Big Business The ‘$14 billion start-up’ building driverless cars

The ‘$14 billion start-up’ building driverless cars

Two auto giants have partnered up to produce autonomous vehicles that won’t "look anything like a car that we all recognise today”.

Jack Derwin

Digital Journalist, Your Money

Self-driving cars are getting closer to being realised
Self-driving cars are getting closer to being realised (iStock.com/imaginima)

The future of driverless cars is looking a little brighter today after Honda took a $750 million stake in Cruise, the autonomous vehicle subsidiary of General Motors (GM).

The partnership will see both companies spend $2.75 billion across the next 12 years to develop and release a line of self-driving cars globally.

Speaking to Your Money’s Business Breakfast live from New York, CNN’s Paul La Monica said the new cars were tipped to look out of this world.

“The hope is that the two will come out with new cars which GM are saying are going to be very innovative because they’re not going to have a steering wheel, they’re not going to have a gas pedal,” La Monica said.

“It’s really autonomous driving in every sense of the word because it’s not going to look anything like a car that we all recognise today.”

Honda isn’t the only company excited by the future of driverless cars, with Cruise having received significant investment to date.

“That values Cruise, which just got an investment from SoftBank recently, at a $14.6 billion valuation,” La Monica said. “That’s a very solid valuation for what’s essentially an electric car autonomous start-up with GM.”

It’s a partnership that General Motors chairman and chief executive Mary Barra said makes sense.

“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,” Barra said in a statement.

While the companies won’t say when their self-driving cars are set to hit the road, they aren’t alone in exploring the exciting new technology.

In August Japanese auto maker Toyota committed $500 million to develop autonomous vehicles in a partnership with Uber.

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