GM and Lyft and Partnerships

GM and Lyft seem to be heading toward a reckoning, similar to what Google and Uber are experiencing. Minus the allegations of intellectual property theft, at least so far.

Reuters has an article (written by Paul Lienert, a reader of this blog) highlighting the tension between GM’s growing presence in the ridesharing space, on the one hand, and on the other hand GM’s partial ownership, of and partnerships with, Lyft.

On the one hand, GM has invested heavily in Lyft, and holds a 9% ownership stake. GM also benefits from Lyft Express Drive, a Lyft program that leases GM vehicles to Lyft drivers.

On the other hand, GM is launching and expanding a number of programs that are competitive to Lyft.

“Maven can provide GM vehicles directly to ride-sharing drivers who previously leased them through Lyft Express Drive and Uber Vehicle Solutions.”

Similarly, GM’s Cruise subsidiary is beta testing a service called Cruise Anywhere that seems poised to use self-driving cars compete directly with Lyft’s core on-demand transportation service.

Partnerships are tricky, especially because companies’ interests and plans can diverge over time. Scott McNealy famously tweeted:

Ronald Coase won a Nobel Prize in part for theorizing about how ownership affects outcomes. Right now we’re seeing lots of self-driving car companies form partnerships, but I suspect in the future we’ll see many more outright acquisitions. Owning a company, instead of partnering with it, and can help align everyone’s interests.

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