The division, named Level 5, is being sold to Woven Planet Holdings Inc., an expansion of Toyota’s research division that focuses on self-driving technology. It is being sold for $550 million, with $200 million as the initial payment. Additional payments of $350 million will be made over the next five years.
This transaction will allow Lyft to generate an adjusted profit in the third quarter of this year. The corporation is expected to save $100 million in annual operating expenses.
Recognizing that Lyft no longer wanted to build its own autonomous vehicle technology was a crucial factor in the decision to sell the division. Instead, it will maximize its value by forming several partnerships with other companies that are working on autonomous driving technology.
This way, it will be able to deliver the latest and safest technologies to its consumers through various partners while still concentrating on the consumer experience and marketplace technology.
By selling its autonomous driving unit, Lyft has joined Uber in abandoning self-driving research.
Uber has sold its self-driving business to Aurora Innovcation Inc. last year. As it strives to make a profit by the end of 2021, the organization has been offloading a number of its costly side projects.