Toyota Motor Corp. will invest $500 million in Uber Technologies as part of a strategy for the two companies to collaborate on autonomous driving development, the Wall Street Journal reports.
Toyota’s investment valued Uber at $72 billion.
Sources tell the Journal that Uber “spent about $750 million on self-driving car development before making cuts this year.” The push “to lower development costs and losses in its autonomous-vehicle unit” came on the heels of a fatal crash earlier this year in Arizona involving one of Uber’s cars.
In recent months, Uber has closed its Arizona autonomous-vehicle operations and laid off about 400 test drivers, some of whom it will rehire after undergoing new training. Uber also has taken its self-driving vehicles off the roads in the San Francisco Bay Area, Pittsburgh and Toronto while investigators look into the circumstances of the Arizona crash.
Technologists believe self-driving vehicles could greatly reduce travel time and save lives by eliminating human error.
Uber’s plan to jointly work with Toyota on building out its autonomous driving technology also says something about the tenuous state of the gig economy, which may not actually be living up to the hype that’s been bestowed upon it over the past few years: The Journal notes that the biggest expense facing ride-sharing companies like Uber and Lyft is the money they have to pay human drivers – which the new technology would conceivably reduce.
This is the second huge investment in Uber over the past year. Last November, SoftBank agreed to a multi-billion funding in the ride-sharing company.
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