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Amazon is in talks to buy driverless vehicle start-up Zoox, according to people familiar with the matter. Photo: AFP

E-commerce giant Amazon in talks to buy autonomous vehicle start-up Zoox

  • Dow Jones reported that Amazon is in advanced talks to buy Zoox for less than the US$3.2 billion valuation from 2018
  • Zoox is unlikely to sell for less than the US$1 billion that it has already raised, according to people familiar with the matter
Amazon
Amazon is in talks to buy driverless vehicle start-up Zoox, according to people familiar with the matter, a deal that would accelerate the e-commerce giant’s automation efforts.

Other companies in the automotive and chip industries have also held talks with Zoox about a potential investment, the people said. At least one other business besides Amazon has offered to buy the company, they added.

Zoox is unlikely to sell for less than the US$1 billion that it has already raised, according to the people, who asked not to be identified discussing private negotiations.

“Zoox has been receiving interest in a strategic transaction from multiple parties and has been working with Qatalyst Partners to evaluate such interest,” the start-up said. It declined to comment on Amazon’s interest. A spokeswoman for Amazon declined to comment.

Zoox had outsize ambition and financial backing. The start-up wanted to build a fully driverless car by this year. However, after a 2018 funding round that valued Zoox at US$3.2 billion, the start-up’s board voted to oust chief executive officer Tim Kentley-Klay.

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The executive criticised the move, saying the directors were “optimising for a little money in hand at the expense of profound progress.”

Dow Jones reported that Amazon is in advanced talks to buy Zoox for less than the US$3.2 billion valuation from 2018.

Amazon is willing to spend heavily to automate its e-commerce business. The online retail giant bought warehouse robot-maker Kiva Systems in 2012 for US$775 million and now has tens of thousands of robots in warehouses around the world.

Paying drivers to deliver packages is still one of the biggest costs in the company’s operation, though. Chief executive officer Jeff Bezos announced plans for drone delivery in 2013, though they have yet to materialise at scale. Last year, Amazon revealed an experimental delivery robot called Scout in the Seattle area that rolls on pavements like a shopping trolley.

Buying Zoox could help Amazon “manage rising shipping costs that we project will exceed US$60 billion by 2025,” Bloomberg Intelligence analysts Jitendra Waral and April Kim wrote in a research note on Tuesday.

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