Aurora Innovation, the self-driving startup founded by three of the most prominent members of the fledgling industry, will soon add another big name to its ranks.
The company said Monday it is acquiring Uber’s Advanced Technology Group, a move that infuses the startup with workers and fresh funds. As part of the deal, Uber plans to invest $400 million in Aurora.
In exchange for the cash and the self-driving tech, Uber will hold a 26 percent ownership interest in Aurora, according to Uber’s 8-K filing with the U.S. Securities and Exchange Commission. The deal is expected to close in the first quarter of 2021.
Uber had been searching for a buyer for its self-driving division for several months, as it sought to eliminate its more ambitious mobility investments and concentrate on its core ride-hailing service. Earlier this year, it sold its Jump bike-share program to rival Lime. Last week, Uber reportedly agreed to sell its air-taxi research division to Joby Aviation.
Though expected, the sale of its self-driving division is nonetheless a hard-look-in-the-mirror moment for Uber that carries more weight than the other divestments.
In 2016, then-CEO Travis Kalanick told Bloomberg that self-driving technology was “basically existential” to the company’s success. But Uber’s current CEO, Dara Khosrowshahi had sought to cut costs at a company that continues to lose hundreds of millions every quarter, including a $1.2 billion net loss in the third quarter this year.
Now, Uber will rely on another company to improve self-driving technology to a point where it could be someday utilized in robotaxis deployed upon its ride-hailing network. Khosrowshahi joins Aurora’s board as part of the acquisition.
Robotaxis will have to wait.
First, Aurora Innovation, the company founded by Chris Urmson, Sterling Anderson and Drew Bagnell, will concentrate on trucking applications for the self-driving system. Aurora opened an office in the Dallas-Fort Worth area this year, where it has begun testing autonomous Chrysler Pacifica minivans and Class 8 trucks.
“We’re shifting the landscape of the automated vehicle space,” Urmson, CEO at Aurora, said in a statement Monday. “With the addition of ATG, Aurora will have an incredibly strong team and technology, a clear path to several markets and the resources to deliver.
“Simply put, Aurora will be the company best positioned to deliver self-driving products necessary to make transportation and logistics safer, more accessible and less expensive.”
Aurora’s partners include Amazon and Fiat Chrysler Automobiles, and the deal with Uber ATG potentially brings aboard another key partner. Toyota Motor Corp. and affiliated supplier Denso Corp. together invested $667 million in Uber ATG in April 2019, a move that valued Uber ATG at $7.5 billion at the time.
The current value of Toyota’s stake in Aurora is not clear. An Aurora spokeswoman said Monday that the company had nothing to announce with Toyota at this time.