On Thursday, Lyft introduced a brand new self-driving automotive partnership with the Mountain View-based startup Drive.ai. In the coming months, Lyft clients in San Francisco will sometimes have their hails answered by Drive’s experimental self-driving vehicles—albeit with a security driver in the entrance seat.
By itself, this is not enormous information. Drive.ai is just not a well known firm and the deal will initially contain solely a handful of vehicles. However the announcement illustrates how Lyft is positioning itself to win the autonomous car wars of the coming decade.
Tesla and Uber need to be the Apple of self-driving vehicles
Many consultants count on that ride-sharing shall be a significant a part of the self-driving automotive enterprise. Without having to pay drivers, ride-sharing providers is usually a lot extra reasonably priced than taxis are at present. And a ride-sharing method will permit firms extra flexibility in when, the place, and the way they roll out self-driving know-how.
If that is true, then success in the self-driving market would require combining three key parts: the vehicles themselves, self-driving software program and sensors, and a ride-sharing community. The main firms in all three of those markets are attempting to place themselves to be dominant gamers in a self-driving future.
Two of the most distinguished know-how firms enjoying on this market, Uber and Tesla, are aiming for a vertically-integrated technique. In Elon Musk’s imaginative and prescient of the future, clients will pull out a Tesla-branded app to hail a Tesla-built automotive operating Tesla-designed self-driving software program. Equally, Uber envisions a future the place clients will use their Uber app to hail Uber-owned vehicles operating Uber-designed self-driving software program.
Different main firms in the market have not tipped their palms but, however there are indicators that a number of others will go on this similar course. GM has a Zipcar-like automotive rental service referred to as Maven that might evolving right into a ride-sharing community, and it additionally purchased the ride-sharing startup Sidecar final yr. Waymo is extensively anticipated to launch its personal self-driving community—maybe based mostly on the pilot project it is conducting in Phoenix proper now. BMW and Ford have—or will quickly have—ride-sharing networks of their very own.
In brief, numerous firms are aiming to be the Apple of self-driving vehicles, providing a vertically built-in product the place one firm controls a number of ranges of the know-how stack—the ride-sharing community, the self-driving know-how, and in some instances the automotive itself.
Lyft needs to be the Android of autonomous automobiles
In distinction, Lyft is pursuing a method that is one thing like the Android technique Google pursued a decade in the past: providing a recognizable model and an open know-how platform that is accessible to be used by a bunch of various companions.
Nobody is aware of which firms or applied sciences will win the self-driving market in the coming decade. The fantastic thing about Lyft’s technique is that Lyft does not want to reply these questions forward of time. By making offers with a variety of firms, Lyft improves its odds of being a key participant no matter how the market shakes out. Standing between clients and a variety of self-driving automotive firms, it is going to be simple for Lyft to take a modest minimize of each trip.
Lyft took a $500 million investment from GM final yr, and the two firms will reportedly add thousands of self-driving Bolts (most likely with security drivers at first) to the Lyft community in 2018. It has signed a deal with Waymo to check self-driving vehicles on its community, too.
After all, as we have seen, GM and Waymo might attempt to launch their very own ride-sharing networks. That is why offers with smaller firms are essential to Lyft’s technique. By working with smaller firms that do not have sturdy manufacturers of their very own, Lyft ensures it can have a robust providing even when the massive guys pull out of Lyft’s community. And it is attainable that a type of startups will beat Waymo, GM, and different main gamers to market.
In June, Lyft introduced it was partnering with nuTonomy, a Boston-area self-driving startup that was spun off from MIT. Whereas not extensively identified by the normal public, nuTonomy has a robust fame in the self-driving world and has been testing self-driving vehicles in Singapore since final yr.
Now it is including Drive.ai, one other self-driving startup that is well-respected in the self-driving world however not a family title.
Drive.ai is an effective match for Lyft
In June, I visited Drive’s company headquarters in a low-slung suburban workplace park. Throughout that go to, the firm’s president, Carol Reiley, hinted that the firm was engaged on a cope with a ride-sharing firm, although she would not inform me which one.
“There’s a lot of demand and interest” from ride-sharing firms for self-driving partnerships, Reiley she informed me. “That industry in particular is extremely eager because that fight is so competitive.”
Greater than half of the price of a ride-sharing trip goes to the driver, she identified, so autonomous vehicles might give a ride-sharing firm an enormous price benefit.
And like Lyft, Drive is specializing in a slender slice of the know-how stack.
“We’re starting with the retrofit kits, off the shelf sensors,” she stated. “We believe this is a software play. Our team needed to stay focused because if we were trying to build cars, if we were trying to build our own sensors, we would need so much capital.”
Initially, Drive tried to license self-driving know-how to incumbent automotive firms, nevertheless it discovered their lengthy improvement cycles—about 4 years—made it too troublesome to keep on the leading edge. So that they shifted to managing their very own car fleet. As well as to partnering with Lyft, Drive additionally gives mobility providers to company clients, serving to them transfer folks and packages on an on-demand, turnkey foundation.
All of this makes Drive a great accomplice for Lyft. Drive does not have the assets or public profile to construct its personal ride-sharing community, simply as Lyft does not have the assets to construct its personal self-driving automotive know-how. In the future, Drive hopes to license its know-how to third events—both providing reference designs to automakers or promoting its know-how to third celebration fleet administration firms. These firms, after all, would want a ride-sharing community to promote their providers to the public, and Lyft is positioning itself to be the firm they select.