Magna to supply Lyft with kits to make self-driving autos (updated)

MAGNA ELECTRO CASTINGS

15/03/2018 16:09

(Adds Magna spokeswoman's comment on timing in paragraph 4,
updates stock price, paragraph 2)
    MONTREAL, March 15 (Reuters) - Magna International Inc
 MG.TO  said on Thursday it will supply Lyft Inc with high-tech
kits to turn vehicles into self-driving cars, but will not
manufacture autos for the ride-hailing service. 
    Magna shares were up 6.5 percent at C$73.48 in midday trade
in Toronto as executives described the auto supplier's role in a
new autonomous venture with Lyft. The Canadian auto-parts
supplier said late on Wednesday it would invest $200 million in
Lyft and work with the firm to co-develop self-driving cars.
 urn:newsml:reuters.com:*:nL3N1QW66I 
    “As we work with Lyft, hopefully that brings for us an
opportunity to potentially do more with Lyft as well as others
in this area,” Magna Chief Financial Officer Vince Galifi told
analysts on a conference call on Thursday. 
    The jointly developed self-driving system is expected to be
on some of Lyft's fleet in the next few years, Magna spokeswoman
Tracy Fuerst said by email.  
    The auto industry is looking for ways to profit from the
rise of car-sharing services like Lyft and bigger rival Uber
Technologies Inc  UBER.UL , which are expected to reduce vehicle
sales and chip away at future profits.
    Goldman Sachs has predicted that the ride-hailing market
will grow eightfold by 2030 to five times the current taxi
market.
    Several automakers, however, do not expect self-driving
vehicles to be in production before 2021.
    Lyft and Magna will jointly own intellectual property
developed through the new venture and Magna will be Lyft’s
exclusive supplier of self-driving car kits, Magna Chief
Technology Officer Swamy Kotagiri said. 
    Those kits - which are used to convert ordinary automobiles
into self-driving cars - include cameras, radar and lidar
systems that use light pulses to gauge a vehicle's position on
and near the road. The kits could also be sold to other parties
besides Lyft, Kotagiri said. 
    Revenue from the deal is not expected to be material in the
short term for Magna, Galifi said. 
    Over the longer-term, "the potential for revenues across the
entire industry is significant," he added.
    Galifi said the Lyft investment was already incorporated
into the company's 2018-2020 outlook.

 (Reporting By Allison Lampert in Montreal
Editing by Marguerita Choy and Suzannah Gonzales)
 ((Allison.Lampert@thomsonreuters.com; 514-796-4212; Reuters
Messaging: allison.lampert.reuters.com@reuters.net))