General Motors has invested $500 million into ride-sharing company Lyft as it looks to the future of transportation.
Besides straight financial backing, GM has pledged to work with Lyft to develop a network of autonomous vehicles that would be available to paying customers on demand. “We strongly believe that autonomous vehicle go-to-market strategy is through a network, not through individual car ownership,” said John Zimmer, Lyft’s president.
Other companies like Uber, Google and Tesla have all begun research in this same area, also assuming that personal car ownership may become a thing of the past when self-driving cars become viable and ready to hit the market. Instead of personal ownership, one company, like Lyft, will own a fleet of self-driving cars which paying customers can summon at any time.
As of now, Lyft is a ride-hailing service that operates the same as Uber, which happens to be its biggest competition. By pressing a button on the Uber or Lyft app, a ride can be hailed and paid for. Lyft is currently valued at $4.5 billion while Uber is worth $62.5 billion.
GM president Dan Ammann says that the company is looking to the future of transportation with this new investment. “We think there’s going to be more change in the world of mobility in the next five years than there has been in the last 50,” he said. Ammann will now sit on Lyft’s board of directors as part of the deal.
Besides the development of a self-driving car network, GM will now be a preferred provider of short-term use vehicles to Lyft drivers, all of which will be equipped with OnStar.
This article originally appeared at AutoGuide.com