Magna International Inc. has made a strategic deal that allows it to play a key role in the disruption of the auto industry, signing an agreement with ride-sharing service Lyft Inc.to develop self-driving technology.
Lyft said Wednesday that it had reached a deal with Canada's Magna International, one of the world's biggest auto suppliers, to jointly develop and manufacture self-driving vehicle systems.
The company says that as part of the partnership, it will also invest US$200 million in Lyft equity, subject to regulatory approval.
The partnership will see the two jointly fund and develop autonomous auto systems for both Lyft and the broader automotive industry.
"This industry is at an early stage; it's like when the first smartphone appeared on the market", said Raj Kapoor, Lyft's chief strategy officer.
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The companies said they will work together to introduce autonomous vehicles to Lyft's ride-hailing network.
Lyft, an on-demand transportation firm headquartered in the US, is forming an alliance with Magna International Inc., a Canada based automotive component supplier, to develop autonomous cars. Au contraire - the ride-sharing company is putting pedal to the metal with a new partnership.
Lyft is racing against Uber, which is developing its own self-driving vehicles. Companies are running small pilot programs, mostly still overseen by human drivers. Earlier in January this year, the ride-sharing firm carried out a test program in Las Vegas with self-driving BMW sedans by using self-driving technology of Aptiv, a United Kingdom based automotive parts tech firm.
It is somewhat critical for Lyft to teaming up with other technology companies and traditional automakers.
Lyft will lead the co-development of the self-driving system at its Palo Alto-based self-driving engineering center. Magna will locate some of its employees in those offices.