Programmatic Lunch

Lyft Attempted to Sell Itself to Uber

Tim Maytom

lyft car highwayTaxi hailing app firm Lyft tried to sell itself to a number of other companies including Google, Apple and rival service Uber, according to The New York Times.

Also amongst the firms approached were Amazon, Chinese taxi hailing firm Didi Chuxing and General Motors, one of the largest investors in Lyft. The talks with GM were the most serious of the discussions, but a written offer was never made.

While Lyft is in no danger of closing down, holding second place in the global ride sharing market and with a cash cushion of around $1.4bn (£1.07bn), the company's search for a buyer demonstrates the difficulties that even large ride-hailing services are having with maintaining their businesses.

With competition from both rival firms and local taxi drivers rife and an increasingly unfriendly view from legislators around the world, the costs associated with expanding or even maintaining a taxi-hailing service are growing every day.

In addition, as autonomous driving becomes closer to a reality for consumers, more auto manufacturers are exploring the option of ride-hailing services that would utilise a fleet of automated cars to provide taxi-style rides for short journeys.

Even industry-leader Uber is feeling the pinch, having sold its Chinese subsidiary to Didi Chuxing to free itself from an expensive battle for the Chinese market that promised to drain resources and investment in a far-from-guaranteed fight.

The changing face of the taxi-hailing app market has already claimed one victim this year, when Uber and Lyft competitor Sidecar shut down in January citing a "significant capital disadvantage".

Lyft may still have a valuation in the region of $5.5bn, following a significant investment by General Motors at the start of this year, but as the taxi-hailing market becomes more cut-throat, that capital safety net could easily disintegrate and apps like Lyft could face coming down to earth with a bump.