Lyft announced on Monday that it had raised $500M from General Motors, half of its latest $1 billion financing round. As part of this investment, Lyft will also work on developing an on-demand network of self-driving cars with G.M.
While this fundraising means that Lyft – with a new valuation of $4.5 billion – can continue to be competitive with Uber, many drivers had strong reactions to this partnership.
The Lyft – General Motors Investment
G.M.’s investment in Lyft is much more than financial support, but rather a “strategic alliance” as described by G.M.’s president, Daniel Ammann. Mr Amman is also joining the board of Lyft.
According to the NYTimes, G.M’s investment of over $500 million is the single largest direct investment by an auto manufacturer into a ride-hailing company in the United States.
This investment points heavily toward the future both of these companies believe in – a future of autonomous vehicles.
In an interview with the NYTimes, John Zimmer, president of Lyft, said, “We strongly believe that autonomous vehicle go-to-market strategy is through a network, not through individual car ownership”.
Neither company gave a specific timeline for when they expected their autonomous vehicle network to be live, but both emphasized how important this autonomous future is to company success.
Drivers React to Autonomous Vehicles
Many drivers in the SherpaShare community see this as a positive announcement for Lyft and the rideshare industry. The announcement adds important financial resources to Lyft’s war chest to further compete with Uber – competition that many drivers see as critical to giving them diverse income options.
However, the realization that this signals a future with potentially less drivers was not lost. As one driver put it:
“[The investment] is a great sign short term for us drivers, perhaps not so good long term.”
Other’s expressed similar long-term dismay:
- “Genius on [Lyft’s] part, GM replaces the role of drivers; rideshare company keeps entire fare. The fleet becomes an expense, while GM pays to play in exchange for equity…Epic play.”
- “Replacing drivers is the plan, what we are doing is just getting people used to pushing the button for the ride.”
The need for the human experience
Some others reacted with skepticism to an autonomous vehicle future, especially in the rideshare industry. The main comments related to people not wanting to give up control and too many industries rely on drivers. While these viewpoints may be seen as entrenched, they do highlight inevitable challenges an autonomous vehicle future will face.
“Nothing like human touch [in ridesharing], to the extent some are going to resist as well. People adapt differently and this will take more than 5 years. I don’t intend to be driving on these platforms anyways lol.”
The last sentiment – not intending to stick around for 5 years – was echoed in many other comments too.
“If I’m still doing this full time in five years you all have permission to put me down like a sick dog”, remarked one driver.
The takeaway
Driver’s realize that short-term competition is great even at the expense of an more autonomous future, which most see as several years away, and even then, with a limited network.
The investment should at least mean more near-term marketing dollars to help Lyft drivers connect with more passengers.
Read more about driver’s reactions and commentary on the SherpaShare Android or iOS app under “Chat”.
SherpaShare Blog 
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How will riderless cars handle the situations drivers handle EVERY single night:
Passengers trying to fit too many people into the car
Passengers to drunk to enter in the correct address
Passengers who aren’t at the location where they are supposed to be picked up
GPS coordinates that take you to a back gate which is locked tight
People who try to bring children into a car without car seat
People who don’t use seatbelts
Etc.
Some of the things we deal with like open containers are theoretically not an issue for a riderless car but others of the issues above could become major LEGAL hurdles. Someone brings a kid without a car seat. How does the car know? It can tell if a seatbelt is fastened but what about a child being held by a parent? Then the car is involved in an accident and the child gets hurt.
Drivers deal with these issues every single day. Driverless cars won’t be able to handle them.
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Obviously I meant driverless cars not riderless. LOL.
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