In the race to develop self-driving cars, General Motors has picked up another hefty ally.
Honda, the Japanese automaker, has agreed to purchase a $750 million stake in GM’s autonomous vehicles unit, GM Cruise Holdings, the two companies said Wednesday. In addition, Honda will contribute $2 billion to the project over the next 12 years.
GM is aiming to develop a vehicle with no steering wheel or pedals that can be used in driverless taxi and delivery services. The automaker hopes to develop the technology into a new and lucrative line of business, apart from making and selling cars and trucks for consumers.
“Having the resources and capability of Honda will move us faster,” GM’s president, Dan Ammann, said in a conference call Wednesday.
Honda’s investment will give it a 5.7 percent stake in the Cruise venture. “This is a vote of confidence in GM and Cruise and what they are doing,” said Mike Ramsey, a Gartner analyst.
GM shares were up more than 2 percent after the announcement.
GM declined to say when it expected to introduce a driverless car, but in a federal government filing in January it asked permission to do so in a commercial ride-hailing service next year.
Waymo, the spinoff of Google, is working in the same direction, as are Ford Motor and Uber, the ride-hailing service.
Honda had pursued other joint efforts — it said in 2016 that it was in talks with Waymo — before making a commitment to GM and Cruise.
“Honda was going to struggle to develop their own product, so they wanted a partner and already had a relationship with GM,” Ramsey said.
Automakers are also working on self-driving technology that can be added to cars that consumers can buy to give drivers the option of relinquishing the task of steering and navigating to their destination. That type of autonomous technology is expected to take more time to reach the market, however.
GM acquired Cruise, then called Cruise Automation, in 2016 for a reported $1 billion in cash, stock and incentive compensation. It has since added other properties to the effort. A year ago, it bought Strobe, a company that specializes in laser-imaging technology, and folded it into Cruise.
Rather than go at it alone, GM has brought on partners to help fund the project in hopes of speeding development. Earlier this year SoftBank, the Japanese tech and investment firm, invested $2.25 billion in Cruise. As part of that deal, GM said it would put an additional $1.1 billion of its own money into the unit, which is based in San Francisco. SoftBank’s investment was made through its Vision Fund, which focuses on the technology sector.
In addition to money, Honda will provide expertise in manufacturing and engineering compact vehicles, where space is at a premium.
“With the backing of General Motors, SoftBank and Honda, Cruise is deeply resourced to accomplish our mission to safely deploy autonomous technology across the globe,” said Kyle Vogt, chief executive of GM Cruise Holdings. “We want to be able to produce this car in high volume when we’re ready to put it into use.”
GM and Honda remain competitors in the business of building cars, SUVs and light trucks, but have grown closer in recent years. In 2017, they began working together on a plant in Michigan to produce technology for vehicles powered by hydrogen fuel cells. They also cooperate in battery technology.
GM, Waymo and others are betting that driverless ride services will spread rapidly once they are able to produce vehicles that can operate with only input from sensors, software and computer chips.
Waymo has made plans to buy up to 20,000 compact electric vehicles from Jaguar Land Rover, starting in 2019. It has also agreed to buy up to 62,000 Pacifica minivans from Fiat Chrysler Automobiles, potentially giving it a fleet of more than 80,000 driverless vehicles within three or four years. Waymo is already operating a test fleet of driverless taxis in Arizona.
For now, GM and Waymo appear to be ahead of most competitors. Last month, Toyota agreed to invest $500 million in Uber, to help it produce self-driving vehicles. Uber’s effort was set back earlier this year when a test vehicle struck and killed a pedestrian in Tempe, Arizona.
Ford is testing a small number of self-driving cars in delivery fleets and hopes to have a self-driving car in production by 2021.