How Much GM Actually Paid for Cruise, and More Automotive News
As we limp into the dog days of summer—Michigan, like most of the Midwest, is currently trapped under what meteorologists are calling a “heat dome”—the state’s automotive technology efforts keep rolling along. Here’s a look at what’s happening around the industry:
—When news broke in March that GM had acquired Bay Area tech startup Cruise Automation, reports put the purchase price at approximately $1 billion in cash and stock options—an enormous sum to bet on the somewhat obscure maker of after-market kits that can turn existing cars into autonomous vehicles. (At the time, GM declined to confirm that figure.)
However, according to a Business Insider article posted today, the price GM paid for Cruise Automation was actually much lower. On a conference call with reporters to discuss the automaker’s second-quarter earnings this week, GM’s chief financial officer, Chuck Stevens, finally confirmed how much the acquisition cost the company: $581 million—$291 million in cash and the rest in stock options.
The $1 billion figure took many industry analysts by surprise when it first began being tossed around, and then gathered momentum on social media. (Founder Collective’s Micah Rosenbloom, for example, tweeted at the time that Cruise Automation co-founder Kyle Vogt was a “two-time unicorn founder” thanks to his involvement in also starting Twitch.)
Business Insider had a withering if delayed response to all the billion-dollar hype: “The issue was if the $1 billion was correct, GM would have overnight created a Silicon Valley unicorn that nobody previously knew existed.” Prior to GM’s purchase, Cruise Automation was valued at roughly $100 million, according to the report.
Dan Primack of Fortune clarified today that the $1 billion figure he previously reported included things like earn-out payments and employee compensation fees, which are not included in GM’s stated price.
—Ford has been busy readying a free tool to help software developers working on products for use in vehicles, and today it officially launched. According to a press release sent by the company, the SYNC 3 AppLink Emulator “allows developers to connect their smartphone to their computer, so they can test how their app will look and work on a SYNC 3 interface that is mimicked by the software platform—all without access to an actual vehicle.” Developers can also set conditions like location, temperature, mileage, and speed to test their app’s response.
Ford is looking to the future in introducing the new program. Today, more than 15 million cars and trucks are equipped with the SYNC platform, and that number is expected to reach 43 million by 2020.
To help spread the word, Ford will host its third annual SYNC AppLink Developer Conference Sept. 7-9 in Las Vegas, and company engineers will be on hand to explain how Ford’s app tools can help developers create more personalized apps driven by vehicle data. In addition, the Ford developer team will hold a hackathon, where developers can compete for prizes. (To download the SYNC 3 AppLink Emulator, head to the Ford Developer Program website.)
—Automotive Grade Linux, a project to develop a common, open-source software stack for connected cars, just released the AGL Unified Code Base 2.0, an updated version of its software. Created by a coalition of AGL member developers and automakers, the updated in-vehicle infotainment platform has several new features, including audio routing and rear seat display. AGL said the code base is ideal for creating navigation, communications, safety, security, and infotainment functionality and is meant to serve as a template that can be used industry-wide. Several members of AGL, including Toyota, Denso, Harman, and Panasonic, are already planning to use the updated software in future products, AGL said.
“The automotive industry is starting to embrace an open innovation mindset, and [manufacturers] and suppliers are realizing that collaboration and joint development benefit the entire industry,” said Dan Cauchy, general manager of automotive at the Linux Foundation, in a press release. “The AGL UCB provides the industry with a single, shared platform that will ultimately reduce fragmentation, improve time-to-market, and reduce the cost of software development for everyone.”