General Motors, ride-hailing company Lyft are joining forces

DETROIT -- General Motors Co. and ride-hailing company Lyft Inc. are forming an unprecedented partnership that could help them beat their rivals to the self-driving future.

See Full Article

Lyft said Monday that GM invested $500 million in the company as part of a round of a $1 billion round of fundraising.

GM gets a seat on Lyft's board and access to the three-year-old company's software, which matches riders with drivers and automates payments. It also becomes a preferred vehicle provider, with the chance to get many more people behind the wheel of a Chevrolet, Buick, GMC or Cadillac.

San Francisco-based Lyft gets the expertise of a 108-year-old automaker with decades of experience in making connected and autonomous vehicles. Detroit-based GM also has an enviable global reach; it sells almost 10 million cars each year in more than 100 countries. Lyft operates in 190 U.S. cities, although it recently formed partnerships with ride-sharing services in China and India.

Together, the companies plan to open a network of U.S. hubs where Lyft drivers can rent GM vehicles. That could expand Lyft's business by giving people who don't own cars a way to drive and earn money through Lyft. It will also give GM a leg up on competitors like Daimler AG and Ford Motor Co., who are developing their own ride-sharing services.

Longer term, GM and Lyft will work together to develop a fleet of autonomous vehicles that city dwellers could summon using Lyft's mobile app. Partnering with GM could give Lyft a boost over its arch-rival, Uber Technologies Inc., which is working on its own driverless cars.

Lyft Co-Founder and President John Zimmer and GM President Dan Ammann say the two companies began serious discussions about three months ago. Both see big changes coming in the traditional model of car ownership, and they had similar ideas about how to address it.

"It felt very natural very quickly," Zimmer said.

Ammann said the resulting partnership is unlike any other in the auto and tech industries.

"Do we want to deploy the resources and people to do everything ourselves, or get there faster by working in partnership?" Ammann said. "We see a really compelling, complimentary set of capabilities."

Following its latest round of fundraising -- which also included a $100 million investment from Saudi Arabia's Kingdom Holding Co. -- privately-held Lyft set its value at $5.5 billion. The company expects revenue of around $1 billion this year. By comparison, GM is valued at $53 billion and earned $153 billion in revenue in 2014.

But neither company can afford to rest. Uber's value could soon surpass GM's, and newcomers like Apple and Google are also eager to disrupt the traditional auto industry.

"We see the world of mobility changing more in the next five years than it has in the last 50," Ammann said.



Advertisements

Latest Economic News

  • Saudis cut tax rate for Aramco ahead of IPO

    Economic CTV News
    RIYADH, Saudi Arabia -- Saudi Arabia on Monday reduced the tax rate for Saudi Aramco as plans move forward to publicly list shares of the state-owned oil giant. The new code, rolled out by royal decree from King Salman, taxes Aramco at 50 per cent on income retroactively starting Jan. Source
  • Justices refuse to hear appeal in music copyright dispute

    Economic CTV News
    WASHINGTON -- The U.S. Supreme Court won't hear an appeal from record companies that want to pursue copyright infringement claims against music site Vimeo for hosting unauthorized recordings from the Beatles, Elvis Presley and other classic artists. Source
  • Canadian marijuana stocks ride high off legalization reports

    Economic CTV News
    TORONTO - Canadian marijuana stocks got a boost Monday following reports that the federal government will introduce a bill next month that aims to legalize pot by July 1, 2018. Shares of Canopy Growth Corp. Source
  • 94-year-old woman honoured for 44 years working at McDonald's

    Economic CTV News
    EVANSVILLE, Ind. -- A 94-year-old Indiana woman is celebrating 44 years of working at McDonald's. The Evansville Courier & Press reports friends and co-workers threw a party for Loraine Maurer, of Evansville, last week. Source
  • Samsung to sell refurbished Galaxy Note 7s after battery fire recall

    Economic CBC News
    Tech giant Samsung Electronics Co. Ltd. said on Monday it plans to sell refurbished versions of the Galaxy Note 7 smartphones that were pulled from markets due to fire-prone batteries. The Note 7s were permanently scrapped in October, roughly two months from the launch of the near-$900 US devices, as more of the phones self-combusted despite a global recall initiated in September. Source
  • Uber grounds self-driving cars after accident in Arizona

    Economic CBC News
    Ride-hailing company Uber has grounded its self-driving car pilot program after an incident in Tempe, Ariz., in which one of its vehicles was rolled on to its side after a collision that wasn't its fault. Local police say a self-driving Uber SUV was operating on its own when it was struck by another vehicle making a left turn at an intersection in Arizona. Source
  • U.S. economy expected to grow slower than Trump pledges, survey finds

    Economic CBC News
    U.S. economic growth is expected to accelerate this year and next, yet remain modest, even if President Trump's promised tax cuts and infrastructure spending are implemented, a survey found. The economy will grow a solid 2.3 per cent this year and 2.5 per cent in 2018, according to 50 economists surveyed by the National Association for Business Economics. Source
  • Retailers offered new, free online course to prevent racial profiling

    Economic CTV News
    HALIFAX -- The Nova Scotia Human Rights Commission has launched a new online course aimed at preventing racial profiling at retail outlets. The free, 20-minute education program -- described as the first of its kind in Canada -- has already attracted attention from businesses in other provinces and the United States. Source
  • N.L. cod stocks on rebound, but still at critically low levels: report

    Economic CTV News
    ST. JOHN'S, N.L. -- A new federal report says northern cod stocks off eastern Newfoundland continue to grow 25 years after a sweeping moratorium, but warns they remain in the "critical zone." The Fisheries and Oceans Canada update concludes fishing should be kept to the lowest possible levels as a precaution. Source
  • United Airlines: Customers 'welcome' to wear leggings

    Economic CTV News
    DENVER -- United Airlines says regular-paying flyers are welcome to wear leggings aboard its flights, even though two teenage girls were barred by a gate agent from boarding a flight from Denver to Minneapolis because of their attire. Source