Toyota sealed the deal with Lyft, will buy Lyft’s self driving tech unit for $550 million

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Toyota will take over Lyft’s self-driving technology unit for $550 million, as the Japanese firm steps up its automation ambitions with the newly created Woven Planet division. This acquisition of Level 5 automation will provide Toyota access to the U.S.A’s ride-hailing firm’s more than 300 employees of the essentially complete autonomy technology.

Another benefit, it will also give Toyota a direct presence in Silicon Valley and London and expand smart-city project “Woven City” at the base of Japan’s Mt. Fuji, effectively helping it ride through dramatic changes expected in the mobility industry and major centres. As for Lyft, the deal will allow it to become profitable sooner and will take away the burden and risk of developing a costly technology that has yet to enter the mainstream. Woven Planet, which was set up in January, intends to continue investing and growing the team, although there is no information regarding its timeline or future acquisition plans. Takaki Nakanishi, an auto industry analyst and chief executive of the Nakanishi Research Institute, commented that by expanding partnerships, Toyota is moving a step towards realizing its goals, including self-driving technology. Toyota, currently offers Level 2 automation with advanced driver assistance technology, and has other self-driving projects plus has been working closely with ride hailing firms. Toyota owns a stake in China’s top ride-hailing firm Didi Chuxing and Southeast Asia’s Grab and also had a stake in the self-driving unit of Lyft’s larger rival Uber Technology Inc , but transferred the stake when Uber sold the unit in December to car startup Aurora. Further, it will develop and build autonomous minivans for ride-hailing networks with Aurora and longtime supplier partner Denso.

Talking about Lyft, it will receive $200 million cash upfront, with the remaining $350 million paid over five years. The sale will allow Lyft to report third-quarter profit on an adjusted basis of earnings before interest, taxes, depreciation and amortization as long as the company continues to recover from the bruising coronavirus pandemic. As per the sources , Lyft will also focus on what it can do best with autonomous vehicles by offering services such as routing, consumer interface and managing, and maintaining and cleaning partners’ autonomous vehicle fleets, which could mean added revenue. It will continue to collect real-world driving data through some 10,000 vehicles it rents out to consumers and ride-hail drivers. The data is valuable for the development of self-driving vehicles that Woven Planet will have access to under the deal. The partnership of both the companies will be the first step of establishing and bringing together the people. Obviously building technology and product requires people, and it is the important point of this deal.

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