Samsung's New $300 Million Fund Bets on Automotive Innovation
14 September 2017 - 7:31PM
Dow Jones News
By Timothy W. Martin
SEOUL-- Samsung Electronics Co. has created a $300 million fund
targeting new investments for automotive software and technology,
the latest sign of the world's largest smartphone maker's desire to
diversify beyond traditional electronics.
Samsung said Thursday that it had secured the first investment
from the automotive-innovation fund, spending EUR75 million ($89
million) to create a strategic partnership with TTTech, a company
that specializes in safeguarding the real-time computer systems
used in connected cars. Audi AG is also a major investor in the
Austria-based TTTech.
The South Korean technology giant has identified the automotive
sector as a critical area for growth, as cars are increasingly
outfitted with multimedia platforms and high-tech software--a
potential windfall for Samsung's displays and semiconductor
businesses.
Samsung has been accelerating investments and other efforts into
the automotive space over the past year, following last year's
announcement of an $8 billion deal to buy U.S. auto-parts supplier
Harman International Industries Inc. Since then, Samsung has won
regulatory approval in South Korea and California to test cars
using its self-driving technology on public roads.
Like many of its Silicon Valley peers, Samsung doesn't plan to
manufacture its own vehicles but sees vast potential to create
autonomous-driving software it could one day sell to traditional
car makers. Samsung's tests in South Korea install its
deep-learning algorithms and other software onto a vehicle made by
Hyundai Motor Co.
The $300 million investment, called the Samsung Automotive
Innovation Fund, will target bets on smart sensors, machine vision
and artificial intelligence that get used by connected cars, the
company said. The firm is "excited to play a leadership role in
supporting and shaping the future of smarter, more connected
vehicles," said Young Sohn, a chief strategy officer at Samsung
Electronics, in a statement.
The fund also serves as a statement that Samsung plans to
continue making new investments following last month's conviction
of the company's de facto leader, Lee Jae-yong. A Seoul court
sentenced Mr. Lee, the company's vice chairman and the Samsung
heir, to five years in prison for bribing South Korea's former
president. Mr. Lee's lawyers have filed an appeal contesting the
court verdict.
Three days after Mr. Lee's conviction, Samsung announced a fresh
$2.3 billion investment in semiconductors. Chips and auto
technology are areas Mr. Lee has signed off on as pillars for
Samsung's direction.
Beyond Harman, Samsung has other auto-tech bets on several
startups that focus on automated driving, sensors or
high-performance computing.
Write to Timothy W. Martin at timothy.martin@wsj.com
(END) Dow Jones Newswires
September 14, 2017 05:16 ET (09:16 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Samsung Electronics (PK) (USOTC:SSNHZ)
Historical Stock Chart
From Mar 2024 to Apr 2024
Samsung Electronics (PK) (USOTC:SSNHZ)
Historical Stock Chart
From Apr 2023 to Apr 2024