In a recent piece that I wrote on Market Eyewitness, I referred to a report by IHS Automotive that projects that 54 million cars will be on the road by 2035. Additionally, I referred to the number of automakers that had developed vehicles with the ability to drive autonomously in some situations. These automakers included BMW, (BMW:GR) Mercedes-Benz, (DAI:GR) Nissan (NSANY) and General Motors. (GM)
Now intelligent car firms are set to receive significant financial backing from Nokia Oyj (NOK1V). Nokia is in the midst of reinventing itself after jettisoning its mobile-phone unit to Microsoft Corp (MSFT) in April.
In a move that is designed to strengthen the competitiveness of it’s HERE mapping division against the likes of Google (GOOG) Maps, Nokia is planning to spend $100 million dollars backing firms that develop intelligent-vehicle technologies. Nokia’s digital-maps business was formed through two acquisitions. One was the 8.1 billion dollar purchase of Navtec in 2008. Navtec was a map provider that was based in Chicago. In 2012, Nokia purchased Earthmine, a 3-D map technology maker. Earthmine is a specialist in 3D street-level imaging.
Nokia provides map data to notable firms such as Microsoft, Amazon.com (AMZN) and Yahoo (YHOO).
The investments will be made by a brand new fund that will be run by Nokia’s venture capital arm, Nokia Growth Partners. Nokia Growth Partners manages 700 million dollars and is a big believer in innovative and disruptive products. We will learn more about Nokia’s new fund today as they are planning to discuss the fund at the Global Mobile Internet Conference in Beijing, China.
Nokia joins Elon Musk and Google as some of the biggest endorsers of the self-driving space. In the midst of his announcement about Tesla’s (TSLA) Gigafactory, Musk boasted that Tesla would lead the way in autonomous car technology right after their last earnings report in January.
It is well-documented that Google has been testing autonomous vehicles in the U.S. According to Google, their self-driving vehicles have driven 700,000 miles to date. Google has touted the improvement of its software with regards to detecting hundreds of objects and situations instantaneously.
Self-driving technology may have another advocate. During Berkshire Hathaway’s annual shareholders meeting, Warren Buffett gave an indirect endorsement to self-driving cars. Buffett believes that self-driving cars could be a real threat to the auto insurance industry. Given the technology’s potential to provide a significant reduction of traffic accidents, he hit the nail on the head.
With this move, Nokia has forced Google to look in the rear-view mirror in the race for domination in the self-driving space.