A consortium of investors led by SoftBank Group Corp and Toyota Motor Corp are in talks to invest over $1 billion into Uber Technologies Inc’s self-driving vehicle unit.
Citing people familiar with the matter, Reuters on Wednesday reported that the company was valued between $5 billion and $10 billion. The Uber was earlier reported to burn through its cash without generating any revenue. The money-losing startup’s self-driving program has been costing hundreds of millions of dollars.
SoftBank witnessed a 4 percent rise in stock prices while Toyota's stocks were flat.
The investment could benefit the American company which aims at a stock market debut in which its value could top $100 billion. Uber or SoftBank was not available for comment. However, speaking to Reuters, a Toyota spokesman said the automaker “constantly reviews and considers various options for investment” but does not have anything to announce.
The Wall Street Journal reported that the deal could be finalised by next month. Japanese firm SoftBank Group saw a 4 per cent rise in its share prices while Toyota’s stock was flat. A year back Toyota injected close to $500 million into Uber to work on autonomous cars, rivalling against the likes of Alphabet Inc’s self-driving unit Waymo.
SoftBank has also invested $2.25 billion in General Motors Co’s self-driving unit Cruise.
In 2018, Uber lost close to $3.3 billion but is now betting on a transition to autonomous driving cars so as to eliminate the need to pay drivers. Autonomous driving tech which is currently in its infant stage was largely criticised after one of Uber’s cars struck and killed a pedestrian in Arizona last year. Nearly nine months later, the company resumed its testing and rolled out another of its autonomous testing vehicles in December last year.
The company is currently testing its autonomous prototypes near its development centre in Pittsburgh, Pennsylvania. Apart from that, it is also preparing to conduct testing in San Francisco and Toronto. Reports suggest that these prototypes are currently being manually driven to gather data before beginning the final test.
The prototypes in Pittsburgh are currently limited to a one-mile course with a posted speed limit of 40kph. Additionally, two safety drivers are deployed in the vehicle at all times with the vehicle’s safety systems such as automatic emergency braking to be left on at all times.