GM partners with Microsoft on self-driving cars
Microsoft has signed a long-term partnership deal with GM, to focus on the carmaker’s self-driving car development business, Cruise.
CNBC’s Michael Wayland reported:
Microsoft has entered into a long-term strategic relationship with General Motors and Cruise, the automaker’s majority-owned autonomous car unit, to accelerate the commercialization of self-driving vehicles.
As part of the partnership, the tech giant will join GM, Honda Motor and other institutional investors in a combined new equity investment of more than $2 billion in Cruise, bringing the post-money valuation of Cruise to $30 billion. The company did not breakdown the new funding by company.
Peter Valdes-Dapena from CNN wrote:
Cruise was founded in 2013 and acquired by GM in 2016 for an undisclosed amount. The company’s current president, Dan Ammann, had been president of GM until joining Cruise in 2018.
GM executives said in 2017 that they expected driverless taxi services to one day be a bigger and more profitable business than selling vehicles directly to customers. At the time, though, they also expected Cruise to be ready to serve paying customers by the end of 2019.
Tomi Kilgore from MarketWatch noted:
GM’s stock soared 9.1% in very active afternoon trading, to trade well above its Jan. 14 record close of $51.53. Trading volume ballooned to 47.4 million shares, compared with the full-day average over the past 30 days of about 16.8 million shares.
Microsoft shares MSFT, +1.78% rose 1.3%.
GM’s stock has now run up 30.9% so far this year, as investors are reaping the benefits of GM’s all-in move into the electric vehicle market. GM has outperformed other electric vehicle makers year to date, as shares of Tesla Inc. TSLA, +2.23% have rallied 18.5% and of China-based Nio Inc. NIO, +3.86% have climbed 18.6%.