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Behind GM’s EV deal with Lyft: The old guard prepares for wrenching change

GM and Lyft are joining forces to test self-driving Chevrolet Bolt electric taxis within the next year. It’s all part of the wrenching change forced on automakers by demographics and quality control. At the same time, a growing population may be owning fewer cars that last longer before they’re scrapped, and urban dwellers increasingly choose ride-hailing services such as Lyft and Uber over taxis or car ownership.

This comes on the heels of GM’s $500 million investment in Lyft at the start of the year, and then in March a $1 billion acquisition of Cruise Automation for its autonomous driving technology. All of this proves, at least to the big automakers, that they’re still in charge of the car business. Put another way, traditional car-makers realize there’s a chance they could be steamrollered by the likes of Tesla, Lyft, Uber, Apple and Alphabet (Google), and they need to adapt at warp speed.

In January, General Motors and Lyft announced “a long-term strategic alliance to create an integrated network of on-demand autonomous vehicles in the U.S.” because they see “the future of personal mobility as connected, seamless and autonomous,” in the words of GM President Dan Amman.

This week, the broad commitment took on more specificity: Within the year, somewhere in the US, GM and Lyft will use self-driving versions of the Chevrolet Bolt EV (inset) to pick up and ferry passengers, according to The Wall Street Journal. It’s not immediately clear if there’d be no driver, which would represent a Level 4 self-driving car: It doesn’t require a driver behind the wheel. Thus, it would be able to chauffeur your kids to school while the parents head off to work.

Automakers have been expected in the next year to deliver, on high-end cars, the first Level 3 vehicles. Those let a driver take his or her hands off the wheel and not pay attention to the car, but be ready to take control within, say, 10 seconds. The best cars on the road today are Level 2, meaning cars with adaptive cruise control and lane keep assist, and they’ll adapt to traffic flow on limited access roads and keep the car centered in lane even around curves. But the driver’s hand always has to be on the wheel, lightly.

That would be a monumental leap forward if truly driverless self-driving happens any time before the end of the current decade, unless it’s for limited driverless tasks such as shuttling passengers around an extended corporate campus. The GM alliance with Lyft and acquisition of Cruise Automation also indicates the traditional US-headquarter automakers are concerned that Alphabet’s self-driving-car initiative is making headway. Just this week Alphabet/Google linked up with Fiat Chrysler to install self-driving hardware and software in a fleet of 100 new Chrysler Pacificas.

Lyft pink mustache

In a statement, the companies declared they’ll work on these four areas:

By partnering with Lyft, GM is also finding a customer for its vehicles, in particular EVs. For all talk about the move to EVs, sales have been slow, especially for automakers other than Tesla. It wouldn’t hurt to have a ready customer for several thousand of the first Chevrolet Bolts. Last year there were 115,000 pure electric vehicles and plug-in hybrids sold in the US — one for every 150 gasoline or diesel cars and SUVs.

Other sales figures for 2015: 25,202 for Tesla, 17,269 for Nissan Leaf, 15,393 for Chevrolet Volt (a PHEV), 11,024 for BMW i3 (the majority sold with a gasoline range-extender), and 9,750 for Ford Fusion Energi (a PHEV). The only other EV with more than 5,000 sales was the Fiat 500e, 6,194 sales. Everyone else was below 5,000: VW e-Golf 4,232, Chevrolet Spark EV 2,629, Mercedes-Benz B-Class ED 1,906, and Ford Focus Electric 1,582.

Sales of EVs and PHEVs will pick up as their range increases and the price delta over combustion-engine-only cars comes down. The new Chevrolet Volt plug-in, for instance, claims 53 miles on battery, and it’s not hard to go 60 miles in urban/suburban driving. In recent weeks, several EV-makers announced or hinted that the new normal will be EVs that claim 200-plus miles on battery power: Tesla Model 3, Chevrolet Bolt, the 2018 Nissan Leaf due in 2017, and a future Ford likely to be called the Ford Model E.

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