Woven Planet Holdings has agreed to acquire Level 5, the self-driving vehicle division of Lyft (NASDAQ: LYFT). Woven will pay $550 million in total cash for the division, founded in 2016 at Open Platform. The sale price includes $200 million in upfront cash and $350 million in additional cash payments over five years.
The acquisition is subject to regulatory approvals and customary closing conditions. It is expected to close in Q3 2021.
Woven Planet Holdings is a subsidiary of Toyota Motor Corp.
“Today’s announcement launches Lyft into the next phase of an incredible journey to bring our mission to life,” Lyft co-founder and CEO Logan Green said. “Lyft has spent nine years building a transportation network that is uniquely capable of scaling AVs. This partnership between Woven Planet and Lyft represents a major step forward for autonomous vehicle technology.”
Level 5 is part of Lyft’s efforts to bring autonomous vehicles to the marketplace. It is a sister business to Lyft Autonomous, which will remain part of Lyft. Level 5 includes over 300 engineers and data scientists and is led by Executive Vice President Luc Vincent.
The sale includes a multiyear non-exclusive commercial agreement between Lyft and Woven Planet, allowing for the sharing of Lyft system and fleet data, the companies said.
“This acquisition assembles a dream team of world-class engineers and scientists to deliver safe mobility technology for the world,” said James Kuffner, CEO of Woven Planet. “The Woven Planet team, alongside the team of researchers at Toyota Research Institute, have already established a center of excellence for software development, automated driving, and advanced safety technology within the Toyota Group. I am absolutely thrilled to welcome Level 5’s world-class engineers and experts into our company, which will greatly strengthen our efforts.”
Lyft’s Open Platform team, which focuses on the deployment and scaling of third-party self-driving technology on the Lyft network, will become the new Lyft Autonomous team.
“We are excited about the transformative impact AVs will have on our world as we drive toward a future that is electric, autonomous and shared,” said Green. “With Lyft Autonomous, we can combine the power of Lyft’s hybrid network, marketplace engine and fleet management capabilities to help our AV partners scale deployment with the highest revenue per mile at the lowest cost per mile. We look forward to continuing to partner with the best autonomous vehicle companies to bring this technology to market.”
The autonomous team, led by General Manager Jody Kelman, will continue to focus on building the “self-driving consumer experience, marketplace and fleet services” future Lyft sees for itself and its customers.
Lyft has been building toward an autonomous future. In a February investor call, Green outlined the vision for the company’s future.
“We believe the future of transportation is as-a-service, and we are the only company in North America that has a seamless multimodal transportation platform that can replace car ownership,” he said. “We expect autonomous vehicles to accelerate this transition. They will transform the ridesharing industry and their business.”
Lyft has already conducted 100,000 paid AV rides since 2018, Green said. The company has been working with Motional, an Aptiv-Hyundai joint venture, on the AV project, and it expects to deploy fully autonomous Motional vehicles in several cities by 2023.
“We’ve spent nine years building a business that is uniquely capable of supporting and scaling AVs,” Green said. “Our Level 5 data-driven autonomy program taps into our greatest asset — our rideshare network — to help tackle some of the hardest problems in self-driving. And our open platform partners will be able to leverage our rideshare technology stack, including our dispatching and routing algorithms, our shared rides platform, and our pricing capabilities.”
Lyft co-founder and President John Zimmer said the company’s fleet management data — which will be shared with Woven Planet — is a key to developing positive cash flows from autonomous vehicles.
“Our fleet management offerings can deliver strong cash flows in advance of AVs. And with AVs, our competitive advantages will become even more clear. For partners, we expect our hybrid AV network will support the highest revenue per mile, while our fleet operations will drive the lowest cost per mile,” Zimmer said.