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Saturday, 09 January 2016 00:37

Lyft to Create Self-Driving Cars After $500M GM Investment

Lyft, a ride-sharing service, announced on January 4 that GM invested $500 million in the company to assist with developing an on-demand network of self-driving cars and a series of short-term car rental hubs across the United States.

Even with companies like Google, Uber, and Tesla devoting resources to the testing and research of self-driving vehicles, there’s little evidence that autonomous cars will become a widespread reality anytime soon.

In California, a law was recently passed that requires manufacturers to receive certification and pass certain cybersecurity thresholds before releasing a self-driving car. In addition, a licensed driver must also be behind the wheel of the car at all times, reported blackenterprise.com

According to PitchBook, GM’s financial backing is the largest direct investment by an auto manufacturer into a ride-hailing company in the United States. This helped raise Lyft’s value to $5.5 billion. With the rise of car services such as Uber and Lyft, auto manufacturing companies are working to adapt to the future of the car market industry. The services are expected to lead to a decrease in car ownership, reported blackenterprise.com.

Several car manufactures have also entered partnership deals with auto-related startup companies. GM partnered with RelayRides in 2011, which is a car-sharing marketplace that allows owners of GM vehicles to rent out their cars. Similarly, Ford teamed up with car-sharing marketplace startup Getaround last year. Also, German automotive company Daimler teamed up with Car2Go, a Zipcar-like service that offers SmartCar rentals in places like Brooklyn, Berlin, and Toronto, reported blackenterprise.com

GM’s president, Mary Barra, will also sit on the board of Lyft.

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