Toyota Motor Corp. invested $400 million in Pony.ai to strengthen its ties with the Chinese provider of driverless-car systems.
The investment extends the companies’ partnership formed last year and pushes Pony.ai’s valuation to more than $3 billion, the startup said in a statement. The pact enables a “deeper integration” of Pony.ai’s technology with Toyota’s vehicles.
“It will enable us to make the commercialization of autonomous-driving vehicles faster,” Pony.ai CEO James Peng said in an interview with Bloomberg TV. “We will put more money into building up the fleet.”
Automakers are striking pacts with driverless-system providers to gain expertise and fend off competition from technology companies seeking to enter the transport business. For Pony.ai, a relationship with Toyota is a vote of confidence as it seeks to take on U.S. rivals such as Alphabet Inc.’s Waymo.
Pony.ai has two testing sites in California and it runs a pilot service with Hyundai Motor Co. in Irvine, Orange County, that provides rides to members of the public. On Wednesday, the company announced a service to City of Fremont employees, offering last-mile rides in its autonomous vehicles between a local transport hub and some of Fremont’s public buildings.
Toyota required no exclusive access to the technology and is open to Pony.ai partnering with other automakers, Peng said.
Last year, Toyota and Pony.ai announced a pilot project on public roads in Beijing and Shanghai, using Lexus RX vehicles and Pony.ai’s autonomous driving system. The companies now plan to explore further cooperation in mobility services.
The coronavirus outbreak has had a “limited” impact on Pony.ai, which has resumed some testing and business operations in China, Peng said.
Founded in 2016, Pony.ai’s investors also include Sequoia Capital China and IDG Capital. The total size of the newest funding round was $462 million, with existing investors putting in $62 million.