Amazon Is Buying Self-Driving Car Developer Zoox For $1 Billion+
Amazon has agreed to buy Zoox, an early developer of self-driving cars, for more than $1 billion in one of the e-commerce giant’s largest purchases.
The Information broke the news of the acquisition and price range on Thursday. Amazon confirmed the purchase but not the price on Friday in a blog where the words “ride-hailing” came up five times — a hint as to what it plans to do with the technology.
“This acquisition solidifies Zoox’s impact on the autonomous driving industry,” said Zoox CEO Aicha Evans in a prepared statement. “We have made great strides with our purpose-built approach to safe, autonomous mobility… We now have an even greater opportunity to realize a fully autonomous future.”
Amazon has already experimented with other self-driving tech such as drones that deliver packages to customers and robots that use the sidewalks to haul packages.
“Zoox is working to imagine, invent, and design a world-class autonomous ride-hailing experience,” said Jeff Wilke, Amazon’s CEO, Worldwide Consumer, in a prepared statement. “Like Amazon, Zoox is passionate about innovation and about its customers, and we’re excited to help the talented Zoox team to bring their vision to reality in the years ahead.”
Other big corporate investors in the autonomous vehicle business include Apple and Toyota. “The Amazon-Zoox deal would be one of the most high-profile acquisitions in the field of vehicle automation, alongside GM buying Cruise, Uber buying Otto, Ford and Volkswagen together acquiring a majority of Argo AI and Intel buying Mobileye, a commercially successful developer of driver-assistance features such as automatic emergency braking,” Amir Efrati reported for The Information.
Amazon will use the acquisition to produce an autonomous ride-hailing fleet to compete with the Alphabet’s Waymo, the Financial Times reported.
The Zoox board fired its founder and former CEO Tim Kentley-Klay in 2018 and former Intel executive Evans became CEO. Rumors of the acquisition first emerged in May, when it was reported that Amazon would acquire Zoox for less than the $3.2 billion it was valued at in July 2018, The Verge reported.
According to Amazon’s press release, Zoox’s C-suite executives will remain in place and the company will continue to operate as a standalone business. Evans and Zoox’s chief technical officer will continue to lead the company.
Zoox has close to 1,000 employees and has been building a self-driving, electric vehicle for six years. The vehicle has no steering wheel and can drive in both directions — “a design intended to allow it to change course quickly if it encounters obstacles in narrow streets,” The Information reported. “Amazon will likely still have to invest billions of dollars to make Zoox’s vehicles a reality.”
Zoox hasn’t gone public yet with its vehicle prototype. It planned to do so later in 2020, but it has been testing its self-driving car software using retrofitted Toyota Highlanders in downtown San Francisco and Las Vegas. Zoox planned to launch its own robotaxi service by 2020, but the software isn’t ready, according to The Information.
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Amazon founder and CEO Jeff Bezos has a net worth of $164 billion, and owns an 11.1 percent stake in the company.
Zoox investors include Lux Capital, DFJ and Atlassian co-founder Michael Cannon-Brooks, The Information reported.
In 2018, Bloomberg Business reported that Zoox was closing on a $500 million funding round that would have valued the startup at $3.2 billion. Before the raise, Zoox was valued at $2.7 billion, the company told TechCrunch.
“Like many self-driving-car companies, Zoox has been hard-hit by the coronavirus pandemic,” Business Insider reported. “The virus forced the company to shut down a planned pilot for its ride-sharing service, and in April the company laid off 120 people.