• by Thom Forbes  @tforbes, January 5, 2016

General Motors will invest $500 million in the ride-sharing company Lyft to create “an integrated network of on-demand autonomous vehicles” in the U.S. over the long term. Meanwhile, and beginning immediately, GM will be a “preferred provider” of short-term rental vehicles for Lyft drivers through hubs in various cities in the U.S. Also, GM president Dan Ammann is joining the board of Lyft, which yesterday announced additional funding from other new and existing investors of $500 million, bringing its valuation to $5.5 billion. 

“GM is closely allying itself to the shift away from its main business until now — the sale of cars — to a more service-oriented one,” observe Kara Swisher and Mark Bergen in Re/code. 

“The future of cars — driverless or otherwise — is increasingly looking like one in which people don’t just stop driving, they also stop owning. Automakers know that. That’s why Ford and Google are reportedly collaborating on self-driving cars, and why GM struck this deal,” writes Alison Griswold for Quartz.

Indeed, “we think our business will change more in the next few years than it has in the last 50,” Ammann tells the Detroit News’ Daniel Howes. “There’s a good chunk of the customer base already that’s saying they want to consume mobility in a different kind of way. We as a company want to make sure that we’re positioned to be at the forefront of that change instead of having change happen to us.”

That was the gist of Ammann’s talking points in several other interviews, too. As for what “autonomous on-demand network” actually “means is unclear as yet, with few details about when and where and how,” Re/code’s Swisher and Bergen observe. 

“It will most likely be some time before a fully autonomous network of cars becomes a reality,” Mike Isaac points out in the New York Times. “Early rules for self-driving vehicles may hinder the speed of progress. California recently passed legislation requiring a driver to be behind the wheel of a self-driving car at all times.”

In an interview with Bloomberg’s Eric Newcomer, Ammann said that GM invested in Lyft rather than stay neutral in its battle with Uber because of the “level of integration and cooperation that will be required, particularly for the longer term.” Newcomer says “the partnership is a blow for Uber, which has fought to overwhelm Lyft, its only substantial U.S. competitor.” But Uber, which is valued at $62.5 billion, has “raised more than $10 billion in financing and is spending aggressively to grow,” he points out.

Lyft, founded in June 2012 by Logan Green and John Zimmer, is now available in more than 190 cities. It lost $127 million in the first half of 2015 on $46.7 million in revenue, according to Newcomer. 

In an interview with Carl Quintanilla on CNBC’s “Squawk Alley,” Zimmer says that the new GM program allows Lyft drivers to rent vehicles “by the day, by the week or by the month. But not have the long-term commitment or high interest rates that a lease might bring … [giving them] an opportunity that they didn't have previously, which sits right in between rental and leasing.” Plus, they can bring the cars home for their personal use, he says. 

“A new generation of leaders [in Detriot] is seeking partnerships that marry the metal-and-rubber cred of automaking with the creativity and utilitarian customization of Silicon Valley,” writes Howes in the Detroit News.

“The ‘future of mobility’ concept is gaining lots of steam in Detroit,” writes Alex Fitzpatrick for Time. “Ford CEO Mark Fields, for instance, has been talking about what he calls ‘smart mobility’ for at least a year” and it has been “experimenting with projects like car-sharing apps and Internet-connected bicycles.”

In other news, CEO Mary Barra, 54, was named GM’s chairman. She replaces Theodore (Tim) Solso, who will stay on as lead independent director.

“Barra has won accolades in many circles for her deft handling of the company's ignition switch crisis and also for guiding the company's release of a highly acclaimed lineup of new and refreshed vehicles,” writes Alisa Priddle for the Detroit Free Press. “She also is credited with building a strong leadership team as she articulates a clear vision.” 

Barra began her career with GM in 1980 as a General Motors Institute (Kettering University) co-op student at the Pontiac Motor Division and has held a wide variety of management positions — and earned an MBA from Stanford — since graduating with a bachelor’s degree in electrical engineering in 1985.