17.6 C
New York
Wednesday, July 28, 2021
No menu items!
Home Others Uber Jettisons Flying Car Project

Uber Jettisons Flying Car Project


A day after Uber handed its autonomous car project to a Silicon Valley start-up, the ride-hailing company is doing the same with an ambitious and money-intensive effort to build flying cars.

Uber is handing its flying car project, Uber Elevate, to the air taxi start-up Joby Aviation, the two companies said on Tuesday. Uber will also invest $75 million in Joby’s effort to build a flying taxi, while agreeing to become partners with the start-up when the flying car reaches the market.

By taking the two technology projects off the books, Uber management, under pressure to make the company profitable, is dumping initiatives that critics said were money pits while focusing on the company’s core ride-hailing service and one of the few bright spots in the pandemic: A fast-growing delivery service. Uber recently finalized the acquisition of its competitor Postmates, allowing the company to double down on deliveries.

Air taxis, like autonomous cars, are unlikely to make a significant impact for several years, and their yearly development costs run into the tens of millions, if not hundreds of millions.

“I know there are questions about whether Uber has any ‘big, bold’ bets left,” the Uber chief executive, Dara Khosrowshahi, said in an email to company employees that was viewed by The New York Times. “I understand that question, but I think it misses the big, bold bets right in front of us: to become the undisputed global leaders in both Mobility and Delivery.”

The company declined to comment further.

The deal is also an indication that the air taxi industry, which has been buoyed by enormous hype and investment over the last several years, is consolidating around a smaller group of companies. Investments are being funneled to a smaller group of companies, said Asad Hussain, an analyst with Pitchbook, a research firm that tracks financial activity.

In 2020, nearly a billion dollars has been invested in this kind of “air mobility” company, according to Pitchbook.

With the new investment from Uber, Joby Aviation, based in Santa Cruz, Calif., has raised over $820 million. The company is trying to build an air taxi service that provides an alternative to overly crowded roadways in large urban areas. It hopes to start a service in at least one city by 2023. But first, government regulators must approve the use of its aircraft, which is a cross between a plane and helicopter that takes off vertically.

When the service begins, it will dovetail with Uber’s existing ride-hailing service, said the Joby executive chairman, Paul Sciarra. In other words, each company will offer an app that will let customers hail rides through the other.

Joby is acquiring Uber Elevate’s technology and its engineering staff. Mr. Sciarra declined to say how much Joby paid for the unit. But if the deal was structured like Uber’s agreement with Aurora, a self-driving car start-up, the answer is likely zero.

On Monday, Aurora said it was taking on Uber’s autonomous vehicle unit but wasn’t paying for it. Like Joby, it received a significant investment from Uber and the promise of a future partnership.

Uber’s decision to offload its air taxi effort shows just how expensive and difficult such an effort will be in the years to come, said Mark Groden, chief executive of Skyryse, another company exploring new kinds of urban air transportation.

“Cracking this market requires a lot of technology that hasn’t been invented yet,” he said. “It is not a simple business.”



Source link

1 COMMENT

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Most People Now Looking to Buy 5G Phones, Kantar Report Suggests

Over two-third of customers in major markets planning to purchase a new smartphone in the next six months prefer getting a 5G model,...

Poco X3 GT With MediaTek Dimensity 1100 SoC, Triple Rear Cameras Launched

Poco X3 GT was launched in Malaysia and Vietnam on Wednesday as an upgraded version of the standard Poco X3 from September last...

Samsung One UI 4.0 Beta Reportedly Announced, Based on Android 12

Samsung One UI 4.0 beta, that will be based on the upcoming Android 12, has been announced, as per a tipster. The announcement...

Take Control of Your Home Screen

Is your phone’s home screen jampacked with pages of apps in random order — including some apps you never use? Sure, you can...

Recent Comments