Ford's foray into ride-sharing via its purchase of the Chariot shuttle service in the beginning of September marks one of the latest moves of big automakers seeking innovation through partnerships with transportation startups.
Other major global automakers, including BMW, Volvo, Toyota, and GM have made several acquisitions and dozens of investments in startups over the past five years, and CB Insights says private auto tech companies are likely to break deal and funding records this year.
Earlier this year, for example, General Motors announced it was buying Cruise Automation to advance the automaker's development of autonomous vehicle technology; Fortune reported the price exceeded $1 billion.
“Cruise provides our company with a unique technology advantage that is unmatched in our industry. We intend to invest significantly to further grow the talent base and capabilities already established by the Cruise team," Mark Reuss, a GM executive vice president, said at the time.
An Industry in the Midst of Transformation
The drive to produce autonomous, or self-driving, cars is clearly a factor in automaker-startup deals. Thirty-three corporations, including Apple, Audi, Ford, BMW, Daimler, Hyundai, Jaguar and Nissan, are working on self-driving cars and advanced driver-assistance systems, CB Insights says. These efforts, however, aren't the only force behind the investing and M&A activity.
"With simultaneous pressure from the rise of electric vehicles, automation, and alternative mobility solutions like ride-hailing, automotive manufacturers are responding with investments and acquisitions across these fields," a recent CB Insights blog post says.
When GM announced the Cruise deal in March, the automaker noted that since the start of the year, it had entered into a strategic alliance with ride-sharing company Lyft and formed Maven, its personal mobility brand for car-sharing fleets in many U.S. cities, in addition to establishing a separate unit for autonomous vehicle development.
GM has invested in, or acquired, more than 15 companies since 2011, making it the most active startup deal-making automaker, CB Insights says, noting the company invested $500 million in Lyft and purchased logistics and delivery company SideCar's assets this year.
As for Ford's Chariot acquisition, the company described the move as marking nothing less than a change in corporate identity.
“We're expanding our business to be both an auto and a mobility company, and partnering with cities on current and future transportation needs is the next major step," Ford President and CEO Mark Fields said in September.
Investment vehicles
GM, BMW, Volvo, SAIC, and Audi have venture groups, while other automakers invest directly, according to CB Insights.
The research firm noted the following investments:
• Toyota made a corporate minority investment in Uber, VW did the same for Gett, and Volvo formed a partnership with Uber.
• Daimler this summer acquired a majority stake in ride-hailing firm Hailo, which operates in Europe and Singapore, after previously investing in Blacklane and buying myTaxi. The automaker plans to develop a European ride-hailing player in its moovel subsidiary.
• Ford, in addition to the Chariot, deal, acquired machine-learning and computer-vision algorithm startup SAIPS this year, adding the Israeli company to its autonomous vehicle R&D team.
Ford noted in August that its plan to deliver an autonomous vehicle in 2021 prompted its SAIPS acquisition and investments in three other companies: Light detecting and ranging (LiDAR) sensors firm Velodyne, which has technology used in high-resolution mapping and autonomous driving; machine-vision company Nirenberg Neuroscience LLC; and high-resolution 3D mapping business Civil Maps.
• SAIC Capital, the Chinese automaker's VC arm, has invested in at least five companies since July 2015, including YourMechanic, an on-demand home auto-mechanic service, which announced in March that it had raised $24 million in March from SoftBank Capital, Lerer Hippeau Ventures, Data Point Capital, Andreessen Horowitz, SAIC, Verizon Ventures, American Family Insurance, PG Ventures, Promus Ventures, and Silicon Valley Bank.
Car communications startup Savari Inc. also raised $8 million as of early this year from SAIC Capital and others, and a SAIC Capital director joined the firm's board.
• Daimler, BMW and Audi jointly acquired Nokia's HERE Mapping app for more than $3 billion last year.
For a detailed major automaker investment and M&A activity from 2011 through most of 2016, check out this graphic from CB Insights. The green lines show investments and the red lines indicate acquisitions. Another chart shows automakers' tech partnerships, investments, and M&A.
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