Lyft and GM Forge New Deal for Automated Cars

While lately all the car app news has been about Uber and its latest New Year’s hijinks, Lyft is also getting some serious headlines of its own thanks to a massive and unexpected investment from General Motors. Lyft will have $500 million to work with, bringing Lyft’s value up to $4.5 billion and raising a whole lot of questions, too.

First question: Does GM actually want to enter the taxi app service? Probably not – but it does want to create long-term connections with these companies for future auto tech profit…and creates a way for GM to reach customers in new ways. Point in case – the Lyft deal will include short-term car rental hubs where GM will provide cars that people can briefly rent instead of calling a taxi. GM has made a number of these deals in the past several years, using smaller companies as incubators for various ideas and services to lower its own risk.

GM and Lyft Car Tech

GM and Lyft combine forces and apps for new rental possibilities.

Of course, this also raises questions about self-driving cars, which Lyft has specifically reported interest in developing (them and everyone else). Is GM about to announce its own driverless car prototypes? Probably not. While the new rental hubs could indeed be a path toward self-driving automobiles in major cities, GM appears more interested in exploring that path and its short-term implications than trying to catch up to far-sighted companies like Uber and Google.

Fortunately, that’s good news for consumers. With focus on the here and now, the GM and Lyft partnership could provide particularly bountiful, working on the kinks on just how people will learn about, approach, and eventually use self-driving cars.

Other proposed projects between the two companies include wider availability of OnStar services, and what appears to be a series of joint apps that will work with offerings from both companies. At this point, it’s difficult to say just when the partnership will bear fruit for on-the-road drivers, but their joint venture planning seems solidly in place.

Updated: January 6, 2016 — 12:43 am

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