Waymo raises another $750 million for its autonomous vehicles

Remember the $2.25 billion funding round Waymo announced in March? Well, it’s been extended to $3 billion thanks to $750 million in fresh capital from a slew of new investors.

The new investors include funds that are managed by T. Rowe Price Associates, Perry Creek Capital, and Fidelity Management and Research Company. Interestingly, T. Rowe Price Associates is a major investor in Cruise, which is likely Waymo’s main rival.

Silver Lake, the Canada Pension Plan Investment Board (CPP Investments), and Mubadala Investment led the original round when it was announced. Other investors included Magna International, Andreessen Horowitz, Autonation, and parent company Alphabet.

In a blog post, Waymo said the extended funding will too be invested into its workforce and building out its Waymo One ride-hailing service and Waymo Via cargo and goods logistics service.

Even before the extra $750 million, Waymo’s funding round was among the largest, if not the largest, in multibillion-dollar investments around self-driving cars. General Motors’ Cruise unit raised $1.15 billion in May 2019, while Uber closed $1 billion from the Softbank Vision Fund in April 2019. Nuro raised $840 million from the SoftBank Vision Fund in February 2019.

During the Morgan Stanley investor conference on Monday, Alphabet Chief Financial Officer Ruth Porat reportedly said the outside investors will help Waymo be more disciplined.

Waymo One is the first publicly accessible self-driving ride-hailing service. While it has provided thousands of rides to customers in Arizona since late 2017, it hasn’t generated anywhere near the amount of revenue required to offset the costs of developing the technology and operating the business. The $3 billion round will help Waymo on its path to scale its self-driving technology.

Like many autonomous vehicle companies, Waymo halted its testing due to the COVID-19 pandemic. However, it recently restarted testing in Arizona. Waymo CEO John Krafcik wrote that the coronavirus has highlighted the need for autonomous vehicle technology.

“COVID-19 has underscored how fully self-driving technology can provide safe and hygienic personal mobility and delivery services. We’re grateful these partners share our mission to make it safe and easy for people and things to get where they’re going.”

Many are speculating that COVID-19 will expedite the consolidation of the autonomous vehicle industry, and that investors are lining up behind companies they believe will survive the pandemic. If so, there’s $3 billion reasons to believe Waymo will be a winner.