Toyota in a $550m deal with Lyft to acquire autonomous car division
Toyota, the world’s largest carmaker, is in a $550m deal as its subsidiary, Woven Planet, has acquired the autonomous driving arm of Lyft, a US company for $200m upfront with $350m paid over five years.
This acquisition follows the exit of Lyft self-driving car game after years of costly investment in research and development.
Speaking about the deal, CEO of Lyft, Logan Green, said the acquisition “represents a major step forward for autonomous vehicle technology”.
Lyft’s autonomous car division Level 5 was launched in 2017, with the company making the ambitious claim that “the majority” of its fleet would be autonomous by 2021 but that goal didn’t see the light of day as the company invested heavily in engineers and researchers with staff spread across bases in the US, UK and Germany.
The ride-hailing company says it will see an annual savings of $100 million of non-GAAP expenses, which it claims will better position it to ultimately earn a profit but the autonomous vehicles industry did not take off as Lyft expected as most of such vehicles on the road today are still test vehicles.
Cutting the expensive division from the company will help in narrowing Lyft’s losses. The company lost $1.8bn in 2021.
Meanwhile, Toyota has also agreed to use Lyft’s fleet data and platform for any commercial service it eventually launches under its Woven Planet subsidiary.
The company aims to engage a large workforce specialising in autonomous vehicles and established a centre of excellence for software development, automated driving and advanced safety technology where it plans to test autonomous vehicles for transport, deliveries and mobile shops.
The deal which is expected to close in the third quarter of this year will make the Company become a major ride-hailing company developing its own autonomous car fleets.
In same vein, last year Uber sold its autonomous vehicle division to Aurora, a startup founded by the former head of Google’s self-driving project.
The deal stipulated that Uber would invest $400 million in the company and its CEO, Dara Khosrowshahi, would join Aurora’s board.
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