San Francisco, California – Honda is investing $2.75 billion throughout the next 12 years to partner with General Motors on autonomous car development. Honda will invest $750 million in GM’s Cruise autonomous subsidiary and pledge another $2 billion in research and development projects with GM and Cruise.
Honda will work jointly with Cruise and GM to fund and develop a purpose-built autonomous vehicle for Cruise that can serve a wide variety of use cases and be manufactured at high volume for global deployment. In addition, Cruise, GM, and Honda will explore global opportunities for commercial deployment of the Cruise network.
In addition to the recently announced $2.25 billion SoftBank investments, this transaction brings the post-money valuation of Cruise to $14.6 billion.
“This is the logical next step in GM’s and Honda’s relationship, given our joint work on electric vehicles, and our close integration with Cruise,” said General Motors Chairman and CEO Mary Barra. “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.”
“Honda chose to collaborate with Cruise and GM based on their leadership in autonomous and electric vehicle technology and our shared vision of a zero-emissions and zero-collision world,” said Honda Executive Vice President and Representative Director COO Seiji Kuraishi. “We will complement their strengths through our expertise in space efficiency and design to develop the most desirable and effective shared autonomous vehicle.”
“With the backing of GM, SoftBank, and now Honda, Cruise is deeply resourced to accomplish our mission to safely deploy autonomous technology across the globe,” said Cruise CEO Kyle Vogt. “The Honda partnership paves the way for massive scale by bringing a beautiful, efficient, and purpose-built vehicle to our network of shared autonomous vehicles.”
In a blog post, Vogt said partnering with two automakers should get Cruise’s technology on the road sooner.
“A rule of thumb in the auto industry is that a new production vehicle takes four years and about $1 billion to design and bring to market,” Vogt said. “That’s assuming you have an existing assembly plant, if not, add another $1 billion, and an experienced team ready to spring into action... The many-year delay from concept to production is the reason the navigation system and music player in your car always feel dated compared to the apps on your phone.”
The autonomous project is far from GM’s first partnership with Honda. Some versions of the long-since discontinued Saturn Vue used Honda engines and transmissions. In 2017, the companies agreed to jointly develop and produce hydrogen fuel cells, and earlier this year, they agreed to jointly develop electric car batteries.