U.S. carmaker General Motors said Monday that it is investing $500 million in ride-hailing service Lyft in an effort to develop driverless, on-demand vehicles.
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Dan Ammann the President of GM said that the carmaker sees the future of personal mobility as seamless, connected and autonomous. Lyft drivers will have access to GM cars and OnStar services, making the ride-sharing options on offer more attractive.
The move is an infusion for Lyft as it competes with larger rival Uber. A fleet of self driven cars that can work on the Lyft platform, as GM thinks of it to be the future of Taxi aggregation services. All that is known is that it will bring together GM’s autonomous technologies with Lyft’s ride-sharing capabilities. Daniel Ammann, president of G.M., said that the company makes their core profit selling vehicles outside of the urban areas where Lyft primarily operates. This will include “personalized mobility services and experiences” through both Lyft and GM’s channels.
GM is investing $500 million in Lyft, Uber’s main competitor.
GM will join Lyft’s board of directors as part of the new partnership, and looks to be moving beyond its traditional role in the auto industry.
Reflecting a clear recognition of the industry’s evolution, GM’s decision to partner with Lyft marks a shift from the one-car-per-person model.
Nowadays, commuters are doing more than just hopping into a vehicle and driving.
The partnership will provide a big boost to Lyft, which has generally played to second fiddle to fellow San Francisco-based startup Uber. Lyft drivers will be eligible to lease GM vehicles on a short term basis to use for business purposes. Uber is already working with researchers at Carnegie Mellon on driverless cars, while Google and Ford are expected to announce a new company focused on autonomous vehicles.
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Following Lyft’s latest round of fundraising, which included a $100 million investment from Saudi Arabia’s Kingdom Holding Co., privately-held Lyft set its value at $5.5 billion.
