Amazon has acquired self-driving start-up Zoox for more than $1.2bn, marking the e commerce group’s biggest investment into the autonomous vehicle sector.
The deal was announced on Friday, according to people familiar with the case.
One of the people said Amazon would work with Zoox to create a ride-hailing fleet, pitting the ecommerce group against Waymo, the self-driving industry leader backed by Alphabet.
However, some analysts expect Amazon to focus on integrating autonomous technology into its delivery network.
The mega acquisition follows purchases of stakes in electric truckmaker Rivian and self-driving start-up Aurora.
Advanced talks between Amazon and Zoox were first reported in May. Neither company has confirmed the talks and both declined to comment.
Zoox was founded in 2014 and valued at $3.2bn in July 2018. Before coronavirus halted vehicle testing, the company had planned to launch a pilot programme for its ride-sharing service this year.
The health crisis has hit companies specialising in developing robotaxi services particularly hard. They made about 100 employees redundant in April while rival Cruise, a division of GM, shed 150 staff.
The industry faced challenges even before the pandemic. Only Waymo has launched a true driverless service.