Amazon.com Inc. (AMZN) just gave investors another clear signal that self-driving vehicles are a key part of its future.
On Thursday, Aurora, a two-year-old, highly regarded Silicon Valley startup led by former Tesla, Uber and Google executives, announced that it raised more than $530 million in Series B financing, valuing it at more than $2.5 billion. Amazon was identified as one the biggest investors in the developer of technology to power fully autonomous vehicles, alongside venture capital firm Sequoia, Lightspeed Venture Partners and Shell Ventures, the investment arm of energy giant Royal Dutch Shell (RDS.A).
Amazon confirmed that it invested an undisclosed figure in Aurora, adding that the move could help to boost safety and productivity. "Autonomous technology has the potential to help make the jobs of our employees and partners safer and more productive, whether it's in a fulfillment center or on the road, and we're excited about the possibilities," the tech giant said in a statement.
Cutting Delivery Costs
For years, investors have been debating the merits of Amazon using self-driving vehicles to make deliveries. The company’s shipping costs nearly doubled from 2015 to 2017 to $21.7 billion, according to its annual report, reported on by CNN.
In 2017, The Wall Street Journal reported that Amazon created a team focused on driverless-car technology to tackle spiraling delivery costs. Sources speaking with the newspaper at the time added that the company also wants to transport goods on a large scale for other companies to compete with the likes of United Parcel Service Inc. (UPS) and FedEx Corp. (FDX). Amazon finally included "transportation and logistics services" in its list of competitors for the first time in its annual report released in January 2019.
In 2017, the tech giant also announced it was partnering with Toyota to explore ways to use self-driving vehicles to ship food around the country and was awarded a patent for a self-driving network.
Recently, evidence has emerged suggesting that headway is finally being made.
Last month, Amazon announced it's testing small delivery robots that drive on sidewalks in Snohomish County, Washington. Around the same time, a photo appeared on social media showing a self-driving truck from the startup Embark pulling an Amazon trailer.
The company has also been internally developing autonomous drones as an alternative way to deliver packages. To date, none of those drones have been deployed yet.