Lyft announced a new partnership with Alphabet’s Waymo on Wednesday, planning to launch a fully autonomous ride-hailing service in Nashville next year. The companies will use Lyft’s Flexdrive subsidiary for complete management of the robotaxi fleet.

This deal sent Lyft stock up over 13%. According to Lyft’s official announcement, the partnership will pair Waymo’s self-driving vehicles with Lyft’s technology and customer service. “This partnership brings together best-in-class autonomous vehicles with best-in-class customer experience,” said Lyft CEO David Risher. “When combined with Lyft’s customer-obsession and world-class fleet management capabilities, it’s two great tastes that go great together.”

“We’re delighted to partner with Lyft and launch in Nashville next year, as we continue to scale our Waymo ride-hailing service to more people in more places,” added Waymo co-CEO Tekedra Mawakana. “Lyft’s extensive fleet management capabilities through Flexdrive make them an ideal partner for expanding to Nashville.”

Riders will begin by hailing Waymo robotaxis using the Waymo app, with plans to add Lyft app access for matched rides in 2026. Waymo, which already has a partnership with Uber, will now expand its dispatch network. News of the Lyft-Waymo collaboration led to a 4.4% drop in Uber’s stock price.

Analysts note that Lyft has been working to close the gap with rivals like Uber and Tesla in the competitive rideshare market. Evercore ISI analyst Mark Mahaney highlighted the importance of Lyft’s ability to grow revenue while improving profitability. Mahaney stated, “We see LYFT’s valuation as very reasonable,” though he noted a need for continued positive trends.

Since the start of the year, Lyft shares have gained 70%, outpacing Uber’s 48% rise over the same period. However, Lyft’s $9 billion market capitalization remains much lower than Uber’s $195 billion.

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