The partnership comes as leading technology companies and automakers, including Tesla and Alphabet's self-driving division Waymo are scrambling to pioneer the market for fully autonomous cars.
GM said in a news release Thursday that the investment is expected to provide the capital necessary to “reach commercialization at scale” next year.
“We’re excited to be joining forces with a tech leader who shares our belief that AV technology will change the world,” GM President Dan Ammann said in a statement.
Experts say that the investment can be seen as a vote of confidence in a legacy automaker. SoftBank is already heavily invested in ride-hailing services, such as Uber and China's Chuxing Didi, as well as self-driving technology firms, including the mapping firm Mapbox. The partnership with SoftBank may offer GM additional expertise in developing app-based services.
“If you combine GM’s technology with the distribution network in some sense represented by Uber and Didi and Grab, it makes it more likely that GM will be the first to market with an autonomous taxi on demand,” said Arun Sundararajan, a professor at New York University’s Stern School of Business. “We hear a lot about Tesla and Uber, but their autonomous technology is significantly behind Waymo and GM. Apart from Waymo, I don't see any other company that poses a significant threat to GM being the first to market at scale.”
The investment will come in two stages, GM said. SoftBank will offer an initial $900 million but will hand over the larger portion only if GM delivers autonomous vehicles “ready for commercial deployment,” subject to regulatory approval. GM will also invest $1.1 billion in its self-driving business as part of the deal.
The driverless vehicle race has been heating up in recent years with several companies announcing plans to bring the technology to the masses. Tesla currently offers a semi-autonomous autopilot mode for drivers, and envisions developing an autonomous-vehicle ridesharing network. Ford is planning to build a driver-less car without a steering wheel or foot pedals by 2021. And on Thursday Waymo announced that it will purchase 62,000 minivans from Fiat Chrysler Automobiles as part of its autonomous initiative.
But some of these efforts have had notable setbacks in recent months. Uber pulled its autonomous operations out of Arizona last week, two months after one of the company's self-driving vehicles killed a pedestrian. And earlier this year a Tesla driver in California was killed after his car crashed into a highway barrier while in autopilot. The fatalities and other car accidents involving self-driving vehicles have raised criticism concerning the pace at which the technology is rolling out on public roads.
GM acquired Cruise Automation in 2016 for an estimated $1 billion. The San Francisco based startup originally developed technology that could be outfitted on existing cars to enable autonomous driving. But since that acquisition, Cruise has become integral to GM's vision. The company unveiled plans in November to launch an on-demand ride hailing service, without drivers, by 2019. And alongside ambitions to develop an all-electric lineup, the company envisions a fleet of collision-free vehicles.
“Teaming up with SoftBank adds an additional strong partner as we pursue our vision of zero crashes, zero emissions and zero congestion," GM chairman and chief executive Mary Barra said in the release.