Lyft to sell autonomous driving unit to Toyota for $550 mn
Washington, United States: Ride-hailing operation in the United States Lyft has agreed to sell its autonomous driving division to a subsidiary of Toyota of Japan for $550 million, the companies announced on Monday.
The decision comes on the heels of a similar divestment by Uber last year, with ride-sharing companies concentrating on core operations as they struggle during the coronavirus pandemic.
The Level 5 Lyft operation will be merged into Woven Planet Holdings, a subsidiary of Toyota Motor Corporation, creating a team of around 1,200 people working on self-driving technology in Japan, the United States, and the United Kingdom.
Under the terms of the deal, Lyft will receive $550 million in cash, with $200 million paid upfront and $350 million spread over five years.
"This acquisition advances our mission to develop the safest mobility in the world at scale," said Woven Planet chief executive James Kuffner.
"This deal will be key in weaving together the people, resources, and infrastructure that will help us to transform the world we live in through mobility technologies that can bring about a happier, safer future for us all."
"This is the first step of establishing and bringing together the people. Obviously building technology and product requires people, and that's much what this acquisition is about," Woven Planet chief executive James Kuffner told reporters on Tuesday.
According to a tweet, this is Woven Planet's first big transaction.
The Toyota subsidiary, which started operations in early 2021, specializes in R&D in fields such as autonomous vehicles, robotics, and smart cities.
In February, the company began work on its flagship project, "Woven City." The laboratory area, built on the site of a decommissioned Toyota factory near Japan's Mount Fuji, will allow for future technology development and research.
According to a Woven Planet spokesman, the first inhabitants of Woven City will be a community of around 360 engineers and inventors within the next four to five years.
Both Lyft and Uber have been developing their own technologies for self-driving vehicles, however, the companies have been severely impacted by the pandemic's downturn in ride-sharing.