Uber Could Soon Pawn Off Its Scandal-Ridden Self-Driving Vehicle Branch to Startup Aurora

Uber Could Soon Pawn Off Its Scandal-Ridden Self-Driving Vehicle Branch to Startup Aurora
Photo: Justin Sullivan, Getty Images

Uber is in talks to sell its scandalridden self-driving vehicle branch, Advanced Technologies Group, according to a Friday TechCrunch report. And it looks like Aurora Innovation, a startup founded by veterans of the autonomous vehicle industry, is first in line to scoop up the “prize.”

Sources familiar with the negotiations told the outlet that Uber “has been shopping” ATG, which carries the grim distinction of the world’s first recorded fatal self-driving car crash, to several potential buyers, and Aurora appears to be the clear frontrunner. While terms of the deal are still unknown, sources say negotiations are “far along in the process” and that the two companies have been in talks since October.

Spokespeople for both companies declined TechCrunch’s request for comment on the matter. But the move would fall in line with Uber’s recent downsizing, spurred in part by the heavy financial hit from the covid-19 pandemic. So far this year, it’s sold its e-transportation arm, Jump, and put a $US500 ($688) million stake in its logistics division, Uber Freight, on the market. And according to its most recent earnings report, Uber reported $US303 ($417) million in net losses for its “ATG and other technologies” segment in the nine months that ended September 30, 2020.

So it would make sense that Uber’s looking to wash its hands of ATG, and not just for financial reasons. Several incidents, including a deadly crash in 2018, exposed serious flaws in the technology powering Uber’s self-driving vehicles and left its public image in tatters. The branch’s former head, Anthony Levandowski, was also fired amid a massive legal battle between Uber and Google’s self-driving segment, Waymo, over stolen technology. He was later sentenced to 18 months in prison for trade secret theft.

In 2019, Uber ATG was valued at $US7.25 ($10) billion, but sources told TechCrunch that the division “was facing a potential down round,” which may have prompted the company to start looking for buyers. Two of Uber’s biggest investors, SoftBank and Benchmark, have also been pressuring the company to revamp its self-driving arm and bring in more outside investment, according to a September Bloomberg report.

Aurora was founded in 2017 by three veterans of the autonomous vehicle industry who previously led programs at Google, Tesla, and Uber. It’s raised more than $US760 ($1,045) million from high-profile investors, including Amazon, Hyundai, and T. Rowe Price, per Business Insider. While that sum is nothing to sneeze at, it’s still a hell of a lot less than ATG’s billion-dollar price tag, so any deal would likely require bringing in outside investment or granting Uber partial equity in the acquisition.