GM Invests $500 Million in Lyft

The 107-year-old legacy automaker said in a release it’s investing $500 million in the pink-mustached company to create a “connected, seamless and autonomous” future for getting around. Lyft is preferred by drivers and passengers for its safe and friendly experience, and its commitment to driving positive change for the future of our cities. Taken together, GM and Lyft could create a network of cars that operate themselves and are available on demand.

While GM committed to doing the research and development of the autonomous fleet, it didn’t specify a timetable for completing it.

Logan Green, co-founder and chief executive officer of Lyft, displays his company’s “glowstache” during a launch event in San Francisco.

Reportedly, it is part of a $1 billion fundraising round which valued the car-hailing startup at $5.5 billion in comparison; Uber was recently valued at greater than $60 billion.

From General Motors’ perspective, part of that future involves self-driving cars. Since 2013, Lyft has raised more than $2 billion.

A recent report on the vehicle industry by McKinsey suggests incumbent automakers are likely to evolve to become software and mobility providers as they chase additional revenue streams based on services and customer data in the years ahead.

GM said it was open to working together with certain Lyft global partners that include India’s Ola, Southeast Asia’s GrabTaxi and China’s Didi Kuaidi, said Ammann. Daniel Ammann, president of GM, will now join Lyft’s board of directors. G.M. will work with Lyft to set up short-term vehicle rental hubs across the United States, where people can pick up a auto and drive for Lyft to make money.

“We believe that the first large-scale deployment of autonomous vehicles will be in this kind of on-demand, ride-share platform”, GM President Dan Ammann said in an interview with the WSJ.

Uber and Lyft, meanwhile, have shaken up the taxi business by making hailing and paying for a ride as easy as just a few taps on a smartphone app.