Microsoft, GM Partner on Self-Driving Car Technology

Cruise's valuation is climbing as it welcomes partners such as Microsoft and Walmart into its ecosystem.

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Need to Know

  • Microsoft has entered into a relationship with General Motors focusing on Cruise, the car manufacturer’s autonomous car unit.
  • Microsoft will become the preferred cloud provider for both GM and Cruise, which will leverage the tech company’s Azure platform.
  • The Microsoft partnership is part of a combined equity investment in Cruise that also includes Honda Motors; no investment breakdown by company has been provided.

Analysis

General Motors has begun a strategic relationship with Microsoft and its majority-owned autonomous car wing, Cruise, that the car manufacturer hopes will accelerate the commercial roll-out of its self-driving vehicles.

The relationship, which the two companies announced on January 19, is part of a larger combined new equity investment in Cruise of more than $2 billion, which also includes a cash infusion from Honda Motors. A company-by-company breakdown of the investment, which brings Cruise’s valuation to more than $30 million, was not made available.

“Our mission to bring safer, better and more affordable transportation to everyone isn’t just a tech race—it’s also a trust race,” Cruise CEO Dan Ammann said in a statement. “Microsoft, as the gold standard in the trustworthy democratization of technology, will be a force multiplier for us as we commercialize our fleet of self-driving, all-electric, shared vehicles.”

Microsoft’s investment in Cruise will ensure that GM will leverage Azure as its preferred cloud and edge computing platform as the automotive company works to commercialize its self-driving car solutions. “Advances in digital technology are redefining every aspect of our work and life, including how we move people and goods,” Satya Nadella, Microsoft’s CEO, said of the partnership. “As Cruise and GM’s preferred cloud, we will apply the power of Azure to help them scale and make autonomous transportation mainstream.”

While Cruise has not yet been made available on a commercial scale, GM has already introduced a model of self-driving car: the Cruise Origin, an autonomous vehicle purpose-built for ride-sharing, which the manufacturer exhibited in January 2020 in San Francisco. At the time, GM said it plans to begin manufacturing the Origin, which seats six passengers, in 2022 at its Detroit-Hamtramck plant. The company had originally planned to debut its autonomous ride-sharing solution by the end of 2019.

And Cruise is already on the road, with a fleet of self-driving, electric cars in San Fransisco that are available as a ride-sharing service to Cruise employees. Last year, when the COVID-19 pandemic hit, Cruise repurposed its fleet of vehicles, using them to deliver 50,000 parcels of groceries and meals to vulnerable and underserved populations in the city. At the time, Robert Grant, VP of global government affairs for Cruise, wrote that “this pandemic has shown how vital self-driving technology is and how it can be used to support crisis relief.”

“We believe that the future of transportation will be a fleet like the one Cruise is developing—one that is powered by all-electric, self-driving technology that will have a multitude of use cases to connect, support, and strengthen the communities we serve,” he continued.

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