After $500M Investment, GM Cools on Lyft

By: Bridget Clerkin June 25, 2018
The partnership between General Motors and Lyft may be over, according to statements from GM.
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When America’s most valuable car company paired off with its second-most-prominent rideshare service, it seemed like a match made in heaven.

General Motors proposed to Lyft with a $500 million deal, and the two set out to merge their families and help each other’s dreams become a reality.

But now it seems the arrangement has suffered from relationship rot.

After nearly two years together, signs of a widening gap—or at least a festering fissure—are abounding between the two automotive behemoths.

Earlier this month, GM President Dan Ammann left his seat on the board at Lyft, which was given to the automaker as part of the landmark 2016 deal.

And just a week after Ammann left Lyft, General Motors CEO Mary Barra told reporters the two companies had no active projects underway.

The moves mark a stark reversal of the original vision set forth by the pair of corporate giants.

At the time the deal was struck, the partnership was hailed as the start of a shared self-driving taxi service. GM would provide the cars and the venture capital funding while Lyft would utilize its pre-existing network to begin building the new business.

Still, since then, both companies have taken different roads toward the same goals.

Lyft has benefited from a flurry of deals made in 2017. Those include lucrative funding boosts from Google parent company Alphabet and GM rival Ford.

For their part, GM seems to be more focused on in-house projects.

The top American automaker has been putting major resources into its driverless efforts, diving head-first into the race to develop the first autonomous car. It brought self-driving start-up Cruise Automation into the fold two years ago toward that end. (Indeed, Cruise helped GM design the first mass-production self-driving ride late last year.)

So deep is GM’s belief in its Cruise subdivision that the company is reportedly mulling a number of options that would allow it to list Cruise on the public stock exchanges.

While the relationship hasn’t officially been closed off, it seems GM’s planned happy ending with Lyft is only receding further in its rearview mirror.

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