Uber Pays Tech Startup to Take Over Troublesome Self-Driving Car Effort

© AP Photo / Eric RisbergIn this file photo taken Tuesday, Dec. 16, 2014, a woman walks past the company logo of the internet car service, Uber, in San Francisco, USA.
In this file photo taken Tuesday, Dec. 16, 2014, a woman walks past the company logo of the internet car service, Uber, in San Francisco, USA.  - Sputnik International
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Uber has yet to have a year in the black, but that hasn’t stopped it from effectively paying an Amazon-backed tech startup to take over its autonomous car development program, Uber ATG.

In a bid to rid itself of a program that’s brought it nothing but trouble, Uber has effectively paid Aurora Innovation $400 million to take over its self-driving car effort. The deal spells the end of a five-year effort by Uber to develop an autonomous driving system that promised to give the ride-hailing service’s profitability a huge boost.

Instead of selling Uber ATG to Aurora, Uber has handed over its equity in ATG and invested another $400 million in Aurora, giving it a 26% stake in the company, TechCrunch reported, citing a US Securities and Exchange Commission filing. Uber ATG is valued at $7.25 billion, with much of that coming from huge investments by Toyota, DENSO and SoftBank’s Vision Fund.

The startup was founded in 2017 and has focused on building the underlying technologies necessary for self-driving cars to navigate without a human driver. It’s backed by venture capital firm Sequoia Capital as well as Amazon.

Despite the high-profile backing, Uber’s autonomous vehicle effort has been a truckload of headaches for the company. In 2018, a woman crossing the street in Tempe, Arizona, was struck and killed by a Volvo XC90 self-driving SUV in an incident ultimately ruled to have been caused by human error from the person in the driver’s seat, not the self-driving system itself. 

Then in 2019, a former Uber executive, Anthony Levandowski, pleaded guilty to nearly three dozen charges of intellectual property theft related to Otto, a self-driving car startup he sold to Uber in 2016. Levandowski had previously headed up Waymo, Google’s self-driving car effort.

Whereas its fire sale of Uber ATG to Aurora represents a continuation of the trend of consolidating autonomous car development, Uber further consolidated the food courier service industry by buying out Postmates last week, combining the company with its own UberEats service.
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