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Softbank is looking to continue on its mega financing spree, despite significant blows to both Vision Fund I and the in-works Vision Fund 2. According to a report from The Information, Softbank’s $300 million investment in the autonomous driving subsidiary of Didi Chuxing is nearing finalisation.

The Japanese conglomerate holding company is already the biggest backer of Didi’s ride hailing service. Talks between the two began since Didi spun off the autonomous unit into a wholly owned subsidiary.

Softbank is making the investment in the midst of a planned asset sale to reduce the company’s debt. The Tokyo-based company announced on Monday that it would sell $41 billion in assets to aid its share buyback. According to reports, the entity was also raising $5 billion to invest in its portfolio of tech start-ups as coronavirus becomes the anvil for a slowing global economy. The pandemic has led to losses as other companies backed by Softbank including Oyo and Uber have been battered.

Didi’s ride hailing service too was hard-hit by the pandemic over the past couple of months and demand had fallen to about 1/5th of the usual. However, since China has shown signs of improvement, demand has gone back up to about 50% of the usual levels. The rise is more prevalent in bigger cities of China where hailed cabs are considered more hygienic compared to public transport.

Didi’s bike sharing units demand has also gone back up to about 80% of the pre-pandemic levels. Before the virus hit, Didi reorganised itself to jumpstart domestically and had geared up to make a mark overseas too.

Investors have bought into prospect of the relevance of automatically driven vehicles and don’t expect the autonomous unit to generate revenue over the next five years. As the complexity and expense of self-driven vehicle models increase, companies have begun to bring in outside investors. Germany’s Bosch invested in one such start-up- UISEE technology.

Chinese start-ups have received considerable amounts of investment too. Pony.ai is the highest valued start-up of its kind in the country. Softbank itself has invested in various entities developing robotaxis for these vehicles.

Although self-driven vehicles can be considered the likely future prospect, none of the businesses working on models are close to launching them on a wide scale. Thus in the case of ride-hailing services, these ventures don’t really offer near-term solutions to their cash burning businesses.

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