Ford Pays Out Over $65m for Shuttle-van Startup Chariot
- Tuesday, September 13th, 2016
- Share this article:
Automaker Ford has announced it is acquiring Chariot, a San Francisco-based mobile-first shuttle service that currently operates using a fleet of Ford Transit vans.
According to Business Insider, Ford paid out $65m (£48.9m) in cash for the startup, plus earnouts to make employees with stock options whole. This considerable pricetag was despite the company raising only a single round of $3m in funding since it emerged from a Y Combinator accelerator in 2015.
Chariot currently operates 100 Ford Transit vans, each with 15 seats, serving as an alternative to the citys crowded mass-transit system. The 28 routes the company runs along are crowdsourced, with Ford planning to introduce data algorithms that will allow trips to be scheduled in real time.
The startup is being acquired by Ford Smart Mobility, the automakers connectivity and autonomous vehicle unit, and the acquisition represents yet another move by Ford to position itself in the ride-hailing market.
The company recently announced plans to get self-driving vehicles on the roads by 2021, likely in the form of a ride-sharing service. As fewer consumers are paying out for new cars, the introduction of an Uber-style service will help the company future-proof itself against dropping revenues.
“Were expanding our business to be both an auto and a mobility company, and partnering with cities on current and future transportation needs is the next major step,” said Mark Fields, CEO and president of Ford. “For more than 100 years, Ford has been part of the community and the trusted source for automotive transportation. Now, we want to work with communities to offer even more transportation choices and solutions for people –to come.”
“Cities globally are dealing with increased congestion, a growing middle class and environmental issues – all of which can be alleviated by developing mobility solutions fine-tuned to the unique challenges of each location,” said Jim Hackett, chairman of Ford Smart Mobility. “At the same time, by expanding our business model to include new forms of transportation –from bikes to dynamic shuttles and more – we are introducing new customers to Ford and creating new revenue and profit opportunities for the future.”