General Motors made an enormous investment into Lyft to the tune of $500 million nearly two years ago. Since then, both companies have waded into new territory to expand their own self-driving car and ride-hailing businesses. That’s made the two companies’ relationship a bit complicated.
Automotive News reported on Monday that GM hasn’t defined the path forward with Lyft just yet, according to Dan Ammann, GM President. Ammann is also a Lyft board member and was an instrumental figure in the $500 million investment. Ammann said despite the complications along the way, the investment was a good one. He called it “constructive” and said GM’s received about a 50 percent return thus far.
The complications come as GM and Lyft both work with rival companies. GM began a pilot program with Uber earlier this year, which has since expired; Lyft received investments from Alphabet and Ford to also commercialize self-driving cars. GM admitted the partnership was never exclusive, but the automaker hasn’t made any further investments into Lyft, either. If anything, Ammann said the knowledge and insight gained from Lyft’s business and operation have made been worthwhile.
“We have worked together on a number of projects and initiatives, where I think everybody has learned and continues to learn from those endeavors,” he said.
GM announced last month that it plans to roll out operational self-driving taxis in 2019. It’s unclear if Lyft will play a part in the distribution.
Comments
While GM doesn’t exactly offer an investment, GM does offer Lyft drivers through their “express drive” program some seriously good deals on rentals that I’m sure they’ll ultimately lose money on due to depreciation…If you can get a Bolt EV, they even throw in free fast charging at chargers GM made a partnership with…
If GM has received $250m in cash dividends from Lyft (a 50% return on the investment), the GM executive should have explicitly stated it as such. Far more likely, the executive was conflating amorphous “benefits” with actual returns on equity invested. And if Lyft was able to pay $250m in cash to GM, then the real story that should be busting out of the AV media should be that Lyft is exceptionally profitable while poor Uber just bleeds cash.