(Bloomberg) -- General Motors Co. and Microsoft Corp. are leading a $2 billion investment round in self-driving car startup Cruise LLC in a deal that will bring the software giant’s cloud and edge-computing capabilities to the venture.
The new funds will raise Cruise’s post-investment valuation to an estimated $30 billion, up from $19 billion when T. Rowe Price Associates Inc. invested in the company
The partnership with Microsoft gives Cruise, which is majority owned by GM, a major software player in its corner. That will help the company compete with Waymo, which has access to the software capabilities of parent Alphabet Inc.
Shares of GM surged 8.6% to $54.28 as of 9:55 a.m. in New York. Microsoft rose 0.4% to $213.52.
Cruise will be able to use Microsoft’s Azure cloud-computing platform to manage its self-driving vehicle network. Azure will handle data and mapping, as well as enable cars to communicate with Cruise’s back office and customer-facing app for ride-hailing. It’s a vital piece of software infrastructure that Cruise needs to build its planned commercial robotaxi service.
“Our mission to bring safer, better and more affordable transportation to everyone isn’t just a tech race - it’s also a trust race,” Dan Ammann, Cruise’s chief executive officer, 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.”
Cruise is preparing to start charging fares for its service in San Francisco later this year.
