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Amazon to Buy Zoox, in a Move Toward Self-Driving Cars

SEATTLE — Amazon said on Friday that it was buying the autonomous ride-hailing start-up Zoox, an ambitious move that could put the tech giant in the business of moving people and not just packages.

Amazon agreed to pay more than $ 1.2 billion for the company, according to a person familiar with the deal. He would speak only anonymously because he was not authorized to discuss the transaction.

Amazon has invested heavily in building out the logistics infrastructure to bring orders to customers, with fleets of planes, trucks and delivery drivers. But Zoox’s ambitions have focused on creating a new kind of autonomous car designed specifically for passenger rides without a driver, sometimes called a “robo-taxi.”

“Zoox is working to imagine, invent and design a world-class autonomous ride-hailing experience,” Jeff Wilke, who runs Amazon’s consumer business, said in a blog post announcing the deal.

Amazon for several years has worked on self-driving technology to deliver goods, a natural fit with its shopping business. Last year, it invested in Aurora, a driverless-technology start-up.

Mr. Wilke expressed concerns in the past that Uber, through its ride-hailing business, could build a direct delivery relationship with customers that it could use to compete with Amazon, according to a person with direct knowledge of the comments. He would speak only anonymously because he feared retaliation for discussing internal conversations.

Uber has said it wants to be the Amazon of transportation, though its self-driving ambitions have been derailed by cost-cutting and legal battles. Waymo, the autonomous vehicle company started at Google, General Motors’ Cruise and Tesla have all been investing heavily in autonomous passenger cars.

Self-driving car companies have struggled in recent months as the industry has recognized that getting them on the road will take longer than the hype had previously suggested. The coronavirus dealt them another blow, since they were barred from testing cars on the roads. In April, Zoox let go more than 100 contract workers who test-drive vehicles.

Amazon said Zoox would operate as a “stand-alone business” and be run by Aicha Evans, Zoox’s chief executive, and Jesse Levinson, its co-founder and technology chief.

Amazon declined to comment on the cost of the deal or Mr. Wilke’s thoughts about Uber. It did not say when it expected the transaction to close.

Zoox and Amazon discussed the idea that someday, cities could have streets designated for autonomous vehicles that would be able to deliver people or packages all day, every day, the person familiar with the deal said.

Laura Gunning, an Amazon spokeswoman, said delivering products was not the reason for the deal. She pointed to the blog post, where Amazon said it hoped to bring Zoox’s “vision of autonomous ride-hailing to reality.”

Buying Zoox could help Amazon use autonomous technology in its deliveries as well as compete with ride-hailing and food delivery providers, analysts at Morgan Stanley wrote last month after The Wall Street Journal reported that Amazon and Zoox were discussing a deal. The analysts estimated that industrywide, ride-hailing income would total more than $ 60 billion in the United States in 2023.

Zoox began talking to potential buyers and investors this year through the investment bank Qatalyst Partners, according to the person familiar with the deal. Daimler, the German automaker, and Nvidia, a chip maker, also held discussions to potentially invest in or acquire the company. Daimler and Nvidia declined to comment.

Amazon offered massive scale and resources to develop its vision.

Zoox was founded in 2014 by Tim Kentley Klay and Mr. Levinson. It aimed to build a symmetrical electric self-driving taxi service with no steering wheel or brake pedal, and raised nearly $ 1 billion in funding from investors including Lux Capital Management and Threshold, formerly known as DFJ. It has been valued as high as $ 2.7 billion.

In 2018, Mr. Kentley Klay was abruptly pushed out, a move he called “Silicon Valley up to its worst tricks” on Twitter at the time. He was replaced by Ms. Evans, a former executive at Intel.

The company was named after zooxanthellae, single-celled algae found in the tissues of some coral and jellyfish that convert sunlight into energy.

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NYT > Technology

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