Lyft and Magna Enter Long-Term Deal to Develop Self-Driving Systems


The melding of Silicon Valley and the traditional automotive industry continues. Ride-hailing service Lyft and Magna International, one of the largest automotive suppliers in the world, said they’re embarking on a long-term collaboration to build self-driving systems capable of operating without any input or oversight from human drivers.

Magna will invest $200 million in Lyft as part of the arrangement. Lyft’s engineers will lead the joint development of the system at the self-driving research-and-development center the company formed last summer in Palo Alto, California. Drawing on its six-decade history as a supplier, Magna will lead manufacturing efforts and potentially offer the automated technology to its customers around the globe.

“They can plug in our system into cars across the world,” Lyft co-founder Logan Green said Wednesday. “They can deploy self-driving systems to all the OEMs they work with. From Lyft’s perspective, we don’t want just one or two companies to have access to self-driving technology. We want every single OEM to make self-driving vehicles, and for those vehicles to operate on the Lyft network.”

Despite much hype, ride-sharing networks like Lyft and Uber account for less than 1 percent of all vehicle miles traveled in the United States. But a proliferation of self-driving vehicles could accelerate Lyft’s vision of shifting the transportation landscape away from one based on personal ownership of cars and toward one that favors subscription services. Just as consumers now subscribe to Spotify to listen to music, Green advocates for a system in which they subscribe to access for cars. He posited Wednesday that such a service might cost $200 per month for 1000 miles in a Lyft vehicle.

“This is a great intersection, in my mind, of two companies coming together, one with automotive experience and one with transportation-network experience.”

– Swamy Kotagiri, Magna

Whatever the specifics on a final price point, self-driving technology is what makes such a service, along with its low price, theoretically possible. Which is why Lyft opened its own research center last summer, now staffed with 100 employees, and has worked to place itself as the center in a constellation of partnerships with the likes of Ford, General Motors, Jaguar Land Rover, Aptiv, NuTonomy, and Waymo.

With the exception of its partnership with GM, which involves an investment of at least $500 million, the Magna relationship appears to be a closer-knit pairing than most others for Lyft, with the ride-hailing service receiving a substantial investment and entrusting Magna with the manufacturing of these systems, once they’re developed. Both companies will share jointly created intellectual property and utilize Lyft data to improve their systems. Employees of the two companies have already been working together in Palo Alto for several months.

“The progress is really impressive,” said Magna chief technology officer Swamy Kotagiri. “Lyft brings ride-sharing leadership and the opportunity to bring the self-driving systems to a large network. This is a great intersection, in my mind, of two companies coming together, one with automotive experience and one with transportation-network experience.”

Lyft mustache logo seen in car window

This is hardly Magna’s first go-around with automated vehicles. Based in Ontario, the company has been among the market leaders in producing advanced driver-assist systems and has already worked as part of an ongoing collaboration with BMW, Intel, and Mobileye on autonomous technology.

There’s no timetable on when Lyft and Magna intend to have the system ready for deployment. In a written statement, both said it will be available for the market “over the next few years.” They intend to build a system that encompasses all the necessary components for self-driving vehicles—what’s known as a “full-stack solution.”

At the onset, the system is expected to be capable of Level 4 autonomy—fully driverless vehicles that require no monitoring from humans—although these cars may be restricted in operations to certain geofenced locations or constrained by weather conditions. Eventually, Lyft officials said Wednesday, it would build toward Level 5 operations, in which fully self-driving cars can go anywhere at any time. But Green acknowledged there remains “a long road ahead” before Level 5 operations are feasible.

Magna produces materials for the auto industry in 335 factories located in 28 countries around the world. Its products run the gamut from exterior body systems to plastics to all-wheel-drive systems to advanced driver-assist features that can handle driving during traffic jams. One of the differentiators between Magna and many competitors is that the company is capable of assembling complete vehicles at its plant in Graz, Austria.

A Magna spokesperson says that’s not part of this particular agreement, but it’s at least conceivable that someday Magna could produce its own vehicles that are deployed on the Lyft network.

Whether it’s the concrete plans to co-develop self-driving systems and sell them to automakers or perhaps one day installing the technology in its own vehicles, this latest deal entrenches Magna as an important supplier to both traditional auto-manufacturing and tech companies alike. For Lyft, it bolsters the company’s position as a potential hub for self-driving rides that could help turn Green’s big vision for future transportation into a reality.

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