(Bloomberg) -- General Motors Co. will invest $500 million inLyft Inc., giving the ride-hailing startup a valuation of $5.5billion and a major ally in the global battle against UberTechnologies Inc.

The investment, part of a $1 billion financing round for Lyft,is the biggest move by an automaker to date when it comes tograppling with the meteoric rise of the ride-hailing industry.

GM and Lyft said they will work together to develop a network ofself-driving cars that riders can call up on-demand, a vision ofthe future shared by the likes of Uber Chief Executive OfficerTravis Kalanick and Google-parent Alphabet Inc. More immediately,America’s largest automaker will offer Lyft drivers vehicles forshort-term rent through various hubs in U.S. cities, the companiessaid in separate statements on Monday.

GM President Dan Ammann, who is joining Lyft’s board as part ofthe deal, expects the automotive industry to “change more in thenext five years than it has in the last 50 and we obviously want tomake sure we’re at the forefront of that change.”

Global alliance

Ammann called the investment an “alliance” with Lyft. Ratherthan stay neutral in the battle between Uber and Lyft, GM investedbecause of the “level of integration and cooperation that will berequired, particularly for the longer term nature of this,” he saidin a phone interview.

Uber’s Kalanick, whose company has been investing aggressivelyin self-driving cars, has said that it could take between 5 and 15years before such vehicles are meaningfully deployed around thecountry.

GM is open to working with some of Lyft’s internationalpartners, which include Didi Kuaidi in China, Ola in India andGrabTaxi in Southeast Asia, Ammann said.

“We certainly see an opportunity to work together through thoserelationships,” Ammann said. “The U.S. is our home market and itcontinues to be our largest market and we think this is the rightplace to begin the journey.”

The partnership is a blow for Uber, which has fought tooverwhelm Lyft, its only substantial U.S. competitor. Sidecar,another American rival, announced in December that it would shutits network.

Uber has raised more than $10 billion in financing and isspending aggressively to grow. Its last round of financing valuedthe company at $62.5 billion.

Doubling financing

Ford Motor Co. is experimenting with its own ride-sharinginitiatives: the company last year started offering a network ofshared cars in London to tap the growing market for on-demanddriving. Fontinalis Partners LLC, the venture firm funded by Fordfamily heir Bill Ford, has previously invested in Lyft.

Lyft’s latest financing round nearly doubles the three- year-oldstartup’s total financing. Since 2013, Lyft has raised more than $2billion, the company said. Bloomberg previously reported that Lyfthad filed to raise $1 billion as part of this financing round. Itslatest $5.5 billion valuation is post- money, meaning it includesthe value from raising its latest $1 billion.

Saudi Arabian billionaire Prince Alwaleed Bin Talal’s KingdomHolding Co. invested $100 million as part of the round and existinginvestors Janus Capital Management, Rakuten Inc., Didi Kuaidi andAlibaba Group Holding Ltd. also participated, according to thestatement.

Lyft lost $127 million in the first half of 2015 on $46.7million in revenue, according to fundraising documents obtained byBloomberg. It said in November it has gained share in key marketssuch as San Francisco, and has a gross revenue “run rate” of $1billion. Lyft has said it’s operating in more than 190 cities.

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