General Motors (GM) is gearing up to lock horns with Uber with its latest acquisition of Sidecar, a ride-hailing and delivery service provider.
The acquisition comes after Sidecar shuttered its app-based ridesharing and delivery service in December last year.
“This is the end of the road for the Sidecar ride and delivery service, but it’s by no means the end of the journey for the company,” said Sidecar CEO and Cofounder Sunil Paul in a Medium post. “We are the innovation leader in ridesharing, despite a significant capital disadvantage, continually rolling out new products that set the bar for others to follow,” he added.
While details of the acquisition were not disclosed, sources told Bloomberg that GM wrote a check valued at under $39 million, the total that Sidecar had raised from investors. Now, with the completion of the acquisition, GM has reportedly absorbed Sidecar's technology, 20 of its employees, including its CTO and Cofounder Jahan Khanna, and other assets. Paul, however, will not be joining the team at GM, according to Bloomberg.
GM plans on plugging the Sidecar team into developing its driverless ridesharing car service, which it is developing in collaboration with Lyft — a project in which it recently invested $500 million.
For building the architecture of the service, GM has also acquired Sidecar's ridesharing patent, which was the first of its kind before Lyft and Uber entered the scene.
"Long ago, we conceived of the technology that gave rise to the rideshare movement. And nearly four years ago, we invented what is now known as “ridesharing” with an app that connected riders with everyday drivers in their personal vehicle," Paul wrote. "We were the first to introduce important innovations, like destination, turn-by-turn directions, shared ETA, shared Rides and back-to-back rides."
As GM's project with Lyft (called Maven) evolves, it is expected to change the dynamics of the ridesharing market, with GM's automobile manufacturing prowess backing it, along with Lyft and its fast-growing reach.
However, GM, as Bloomberg pointed out, is not the only automobile company looking into cutting itself a piece of the market, which is heavily dominated by Uber today. Ford Motor Co. is also looking into developing a new ridesharing service with its latest acquisitions that include German ridesharing apps mytaxi and RideScout.