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Lyft and Waymo Reach Deal to Collaborate on Self-Driving Cars

As the race to bring self-driving vehicles to the public intensifies, two of Silicon Valley's most prominent players are teaming up.

Waymo unveils a self-driving Chrysler Pacifica minivan in Detroit, Michigan, U.S. on January 8, 2017.
Brendan McDermid | Reuters
Waymo unveils a self-driving Chrysler Pacifica minivan in Detroit, Michigan, U.S. on January 8, 2017.

Waymo, the self-driving car unit that operates under Google's parent company, has signed a deal with the ride-hailing start-up Lyft, according to two people familiar with the agreement who spoke on the condition of anonymity because they were not authorized to speak publicly. The deal calls for the companies to work together to bring autonomous vehicle technology into the mainstream through pilot projects and product development efforts, these people said.

The deal was confirmed by Lyft and Waymo.

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"Waymo holds today's best self-driving technology, and collaborating with them will accelerate our shared vision of improving lives with the world's best transportation," a Lyft spokeswoman said in a statement.

A Waymo spokesman said, "Lyft's vision and commitment to improving the way cities move will help Waymo's self-driving technology reach more people, in more places."

The partnership highlights the fluid nature of relationships in the self-driving-car sector. From technology companies to automakers to firms that manufacture components, dozens of players are angling for a slice of an autonomous vehicle market that many believe will ultimately be a multibillion-dollar industry. To gain an edge and outmuscle rivals, many of these players are forming alliances — and sometimes shifting them.

The deal between Waymo and Lyft has competitive implications for Uber, the world's biggest ride-hailing company, which has recently had to confront a spate of workplace and legal problems.

Lyft is a distant No. 2 to Uber among ride-hailing services in the United States, and the two companies are bitter rivals. Waymo is also competing fiercely with Uber in the creation of technology for autonomous cars and is embroiled in a lawsuit over what it says is Uber's use of stolen Waymo trade secrets to develop such technology.

Details about the deal between Waymo and Lyft were scant. The companies declined to comment on what types of products would be brought to market as a result of it or when the public might see the fruits of the collaboration.

The companies have left hints as to what the partnership could entail. Lyft, for instance, has long said it wants to match its network of passengers and drivers with partners in the transportation industry. Last year, it struck a deal with General Motors, a major Lyft investor, to help with that goal. Under that agreement, the companies plan to test autonomous Chevrolet Bolt vehicles using Lyft's network with the general public in the next few years.

Waymo has pursued its own partnerships. It is working with Fiat Chrysler on a fleet of minivans and is in talks with Honda about a possible deal that would put Waymo technology in Honda test vehicles. Waymo also recently introduced a pilot program in Phoenix in which consumers can apply to hail self-driving Chrysler minivans and Lexuses for free rides around the city. The company has said it hopes to find new ways through such partnerships to bring its self-driving technology to the general public after nearly a decade of development.

The seeds of the partnership between Waymo and Lyft were planted in discussions last summer, the two people familiar with the deal said. The talks involved Logan Green and John Zimmer, the founders and leaders of Lyft, and John Krafcik, the chief executive of Waymo. The idea of a deal evolved as the executives visited each other's campuses in the ensuing months.

The partnership indicates that Waymo believes its self-driving-car technology has moved past the research stage and is ready to be applied commercially. Alphabet, Google's parent company, spun Waymo out of Google's X project lab in December after more than eight years of research. The vehicles have been tested on closed tracks and open roads in Arizona, California, Texas and Washington, where state law allows the testing of autonomous vehicles. Waymo has said the vehicles have logged more than three million miles of real-world testing.

For Lyft, which has said it has no plans to develop its own self-driving-car technology, the deal with Waymo offers another way into the market. While Lyft has said it will work with G.M. on testing autonomous vehicles, G.M. bought the self-driving-technology start-up Cruise Automation last year for more than $1 billion in cash and stock. Cruise has begun testing G.M. vehicles on the open road in California.

In April, Lyft said it had raised $600 million in new venture capital, an investment round that valued the company at $6.9 billion.

Uber did not immediately respond to a request for comment.

Travis Kalanick, Uber's chief executive, has said he views the race to bring self-driving technology to market as "existential" to Uber's future. The company has poured hundreds of millions of dollars into catching up with Google and others. Uber opened its Advanced Technologies Center in Pittsburgh — a hub for self-driving-car research — in 2015 and recently announced a similar initiative in Toronto. Last year, Uber acquired Otto, a self-driving trucking start-up, for more than $680 million.

The Otto deal led Waymo to accuse Uber in a lawsuit of using Waymo's intellectual property in its self-driving-vehicle designs. Waymo says Anthony Levandowski, who had been a key leader of Google's self-driving car research and a founder of Otto, conspired with Uber to steal thousands of files related to autonomous-vehicle research before he left Google last year on his way to joining Uber.

The case could affect the speed at which Uber's self-driving efforts come to market. Waymo is seeking a preliminary injunction to block Uber from using its trade secrets. If granted, such an injunction could halt some of Uber's research until a trial concludes.