In Smart Move, GM Adds Honda to Cruise AV Partnership
We like the deal because it gives Cruise even more cash to scale up quickly without further using GM's funds.
We are not changing our fair value estimate for
buying EV batteries from GM.
We like the deal because it gives Cruise even more cash to scale up AVs quickly without further using GM's funds. We think it's also possible Honda's presence, as well as Cruise's partnership with Japan's SoftBank, announced May 31, means GM can more easily access the Japanese market for AV services next decade. The deal also supports our view that GM Cruise is a leading AV player. Honda Executive Vice President Seiji Kuraishi said in the media release "Honda chose to collaborate with Cruise and General Motors based on their leadership in autonomous and electric vehicle technology and our shared vision of a zero-emission and zero-collision world." We don't expect funding to get in the way of Cruise meeting its goal of launching AV ride-hailing at scale next year, likely in San Francisco, and perhaps New York and Phoenix, to start.
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