General Motors Invests $500M in Lyft to Create a Network For Driverless Cars

General Motors has invested $500 million in Lyft motors. Last month Lyft was looking to raise an investment of $1 billion, at a post money valuation of $4 billion. Though recently the company announced that the post valuation of the company now is $5.5 billion.

Lyft has also been backed by investors like Alibaba, Didi Kuaidi, Tencent holdings, Rakuten

Lyft has also been backed by investors like Alibaba, Didi Kuaidi, Tencent holdings, Rakuten (Image Source)

This comes as a strategic partnership between the two companies, where they plan to create an autonomous on demand network. 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. This is GM’s biggest investment in an outside company.

GM has been working on creating driverless cars since long and this investment shows how close they are at realising that goal. The company has realised the value of car aggregation services like Uber and Lyft. People have started buying less cars, after all it has always been ‘car ownership vs the network’.

GM President Dan Ammann stated that the car industry is going to change more in the next five years than in the past 50.

John Zimmer, President and Co-Founder of Lyf, said, “Working with GM, Lyft will continue to unlock new transportation experiences that bring positive changes to our daily lives. Together we will build a better future by redefining traditional car ownership.”

Lyft has also been backed by investors like Alibaba, Didi Kuaidi, Tencent holdings, Rakuten etc. In September, Uber announced that it is funding $5.5 million to Carnegie Mellon’s National Robotics Engineering Center to support a new faculty chair in robotics. This came as a part of deal, which happened in February between Uber and the University, to make driverless cars.

Similar Read:  Fundingwire - FinTech Startup Zestmoney Raises $6.5M Led by PayU & 8 More Funding Updates

The final context is that Lyft and GM are going against Uber. The move can also be said to be a part to increase the ‘Anti-Uber’ alliance, as Didi, Ola and GrabTaxi have already joined the pact.

Category