Uber has sold its self-driving car business called Advanced Technologies Group (ATG) to startup Aurora Innovations and as part of the deal, the ride-hailing platform will invest $400 million in Aurora and its CEO Dara Khosrowshahi will join the startups board of directors.
The deal marks the end of Uber's dream of replacing its cabs with robot drivers.
"By adding the people and technology of Uber's Advanced Technologies Group to the incredible group we've already assembled at Aurora, we're shifting the landscape of the automated vehicle space," said Chris Urmson, co-founder and CEO of Aurora.
"With the addition of ATG, Aurora will have an incredibly strong team and technology, a clear path to several markets, and the resources to deliver".
In addition to acquiring ATG, Aurora also announced a strategic partnership with Uber that connects its technology to the world's leading ride-hailing platform.
"It strengthens our position to deliver the Aurora Driver broadly. In support of Aurora's partnership with Uber, Uber is investing $400 million in Aurora and Uber CEO Dara Khosrowshahi is joining our Board," the company said in a statement late on Monday.
"Few technologies hold as much promise to improve people's lives with safe, accessible, and environmentally friendly transportation as self-driving vehicles," said Khosrowshahi.
"For the last five years, our phenomenal team at ATG has been at the forefront of this effort—and in joining forces with Aurora, they are now in pole position to deliver on that promise even faster," he added.
Selling its self-driving business came at a time when Uber faced several problems with the division.
The company was sued by Waymo for allegedly stealing the Google offshoot's trade secrets. Uber's engineer Anthony Levandowski was recently sentenced to 18 months in jail for the crime.
In 2018, a 49-year-old woman Elaine Herzberg was struck and killed by a self-driving Uber vehicle while walking her bike across the street in Tempe, Arizona.
The US National Transportation Safety Board split the blame between Uber, the safety driver, the victim, and the state of Arizona.
Aurora, founded in 2017 by the leading experts in self-driving, is building the Aurora Driver, a platform that brings together software, hardware and data services to operate passenger vehicles, light commercial vehicles, and heavy-duty trucks across a range of applications.
Aurora is backed by Amazon and Sequoia, among others, and tests its vehicles in the Bay Area, Pittsburgh, and Dallas.
The company has offices in those three cities and in Bozeman, Montana.