British AI star Seeing Machines secures £26m Mitsubishi funding

Automotive giant Mitsubishi has bought a 15 per cent stake in British AI star Seeing Machines, as part of a partnership designed to accelerate the London-listed firm’s growth.

Mitsubishi Electric Mobility has invested £26.2million via a subscription agreement it says will strengthen Seeing Machine’s balance sheet and provide ‘capacity to focus on growth opportunities across new markets within existing transport segments’.

Seeing Machines, which makes in-car AI tech to monitor drivers for drowsiness and attentiveness, is hoping to break even for the first time in the financial year to June 2025. 

A collaboration agreement will cover ‘joint automotive business opportunities’ in Japan, where the firms will also target aftermarket growth in addition to North America and Europe, the firms said in a joint statement.

The pair said the deal would leverage Seeing Machines’ proprietary IP to ‘assess and enter new adjacent markets’ where Mitsubishi Electric Mobility has a leadership position.

The automotive giant plans to increase its stake to 19.9 per cent through acquisition of additional shares.

Seeing Machines makes in-car AI tech to monitor drivers for drowsiness and attentiveness

The vision-based monitoring technology provider recently disclosed a £2million a month cash burn.

Seeing Machines boss Paul McGlone said the ‘pivotal partnership’ would promise ‘significant benefits for both of our businesses’

He added: ‘We have carefully considered this investment in Seeing Machines to ensure that we remain focused on supporting our existing key customers and programs across our transport focused businesses, while we accelerate growth in currently under-served markets and together explore new opportunities in adjacent industries.’

Seeing Machines shares soared 11.46 per cent to 4.96p in early trading, bringing 2024 losses to around 12.8 per cent.

Peel Hunt analysts had previously flagged concerns ‘caused by industry weakness’ about Seeing Machine’s balance sheet and its ability to meet its profitability targets.

But the broker said on Monday the Mitsibishi deal, ‘whilst diluting shareholders’, is a ‘decent option to solve its balance sheet issues’ and unlocks ‘significantly more value in terms of commercial opportunities than a distressed equity raise’.

Peel Hunt, which holds a buy rating for Seeing Machines with a target price of 7p, said: ‘This investment secures the next c.18 months of runway for Seeing Machines, by which point the company plans to be cash generative

‘Previously, Mitsubishi was working with SEE’s main competitor Smart Eye in the automotive sector, underlining the superiority of its product.

‘This is not the first significant customer to make the switch, as BMW (a significant volume driver) previously swapped Smart Eye for Seeing Machines

‘We believe in the long-run prospects of the firm, further bolstered by the continued progress in its automotive product.

‘Once camera-based DMS becomes mandated in the summer of 2026, we expect to see demand accelerate, bringing with it significant cash generation.’