Toyota subsidiary acquires Lyft's autonomous driving unit for $550 million

Toyota's Woven Planet subsidiary has acquired Lyft's autonomous driving unit, Level 5, for $550 million, the companies announced on Monday.

Why it matters: After ride-hailing companies poured a lot of money into, and made big deal out of their investments into autonomous driving, both Uber and Lyft have now sold off their self-driving car units.

• It's also notable that Lyft is selling its unit to Toyota despite its initial close relationship with General Motors, which invested $500 million into the ride-hailing company along with a partnership to work on autonomous driving.
• Since then, GM acquired self-driving startup Cruise, raising questions about its relationship with Lyft.

Background: Woven Planet is a subsidiary of Toyota that's developing a private testbed near Japan's Mount Fuji, where the company says it's building a prototype "city of the future."

Deal details: Of the $550 million in cash, Lyft will get $200 million upfront subject to certain closing adjustments, and $350 million over a five-year period.

• The companies have also signed a partnership to use Lyft's system and fleet data as part of Woven Planet's development of autonomous driving tech.

The bottom line: A few years ago, companies including Lyft made bold predictions about the rapid arrival of autonomous driving—but it's clear that getting there is much harder, and some companies are now cutting their losses and focusing on their core competencies.

Go deeper: The rise of AV testbed cities