Autonomous cars are the future of the automotive industry, but unfortunately for traditional automakers, it’s the technology industry that’s leading the charge in this area, meaning that these automakers must rely on companies like Apple and Google for their self-driving technology. Not wanting to have to rely on outsiders, many automakers have turned their attention to Silicon Valley in an effort to develop their own self-driving technology, which is why General Motors just spent more than $1 billion on an autonomous car startup called Cruise Automation.
Detroit automotive giant General Motors has acquired Cruise Automation, a Silicon Valley maker of driverless cars, as it moves to head off a challenge to its dominance from some of the tech world’s biggest companies. GM’s acquisition of Cruise “provides our company with a unique technology advantage that is unmatched in our industry”, said GM executive vice-president Mark Reuss. “We intend to invest significantly to further grow the talent base and capabilities already established by the Cruise team.” And it’s also a way for the company to take a bite out of two competitors: Cruise’s main product, the Cruise RP-1, was an autopilot system that could be installed in cars made by Audi (owned by Volkswagen) and Nissan (owned by Renault). General Motors said in a statement Friday it was interested in the startup because of its “deep software talent and rapid development capability to further accelerate GM’s development of autonomous vehicle technology”. The purchase comes as Apple, Alphabet, Uber and other tech companies are all working on self-driving car projects. Sam Altman, president of startup fund Y Combinator and an investor in the company, said that Cruise’s software and hardware was far ahead of the curve and that the acquisition by GM would give it a chance to expand.