Uber’s autonomous vehicle unit has raised $1 billion from a consortium of investors including SoftBank Group Corp, giving the company a funding boost for its self-driving ambitions on the eve of its public stock offering.
Uber said on Thursday that the investment values its Advanced Technologies Group, which works to develop autonomous driving technology, at $7.25 billion. SoftBank will invest $333 million from its $100 billion Vision Fund, while Toyota Motor Corp and automotive parts supplier Denso Corp will invest a combined $667 million.
Toyota will also contribute up to an additional $300 million over the next three years to help cover the costs of building commercial self-driving vehicles, Uber said.
SoftBank was already the largest shareholder in Uber, with a 16 percent holding. Toyota has a smaller stake.
Their partnership is geared toward preparing for "mass production and commercialization of automated ridesharing vehicles and services," Uber said.
Uber CEO Dara Khosrowshahi said that the funding “will help maintain Uber’s position at the forefront of” a transforming transportation industry.
The self-driving business unit brings in no meaningful revenue for Uber, which last year lost $3.03 billion.
Uber publicly filed a prospectus to go public last week and is expected to begin a road show to promote the stock before the end of the month. The offering could value Uber at roughly $100 billion.
As part of the investment, ATG becomes its own legal entity but remains under the control of Uber. A new ATG board will be formed, with six directors appointed from Uber, one from SoftBank and one from Toyota. Eric Meyhofer, currently the head of ATG, will take the title of CEO and report to the new board.
Self-driving business has failed to deliver on bold promises of commercial autonomous cars. A crash in March 2018 involving an Uber self-driving SUV killed a pedestrian in Tempe, Arizona, and forced the company to shutter its biggest testing operation and halt autonomous driving in other cities.
Uber now has a small number of cars testing in Pittsburgh, during the day and in good weather, with two safety drivers. They do not offer rides to passengers.