Startups

Ford-Owned Shuttle Startup Chariot Is Shutting Down

Chariot, the Ford-owned transportation startup that operates commuter shuttle services in nine North American cities and internationally in London, is shutting down.

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Chariot announced on its company blog that it will end its U.K. service on Friday, January 25th, and will end service in the U.S. on Friday, February 1. All operations, including servicing its enterprise customers, will end in March.

Employees at the company were told today that their positions are terminated, according to an employee at the company who didn’t want to be named. The company is providing at least a portion of its employees with a severance package equal to 60 days worth of salary.

Founded in 2014, Chariot raised $3 million in seed funding from Y Combinator and others prior to being acquired by Ford in September 2016 for $65 million. A couple months before the acquisition was formally announced Ford had featured a blog post by Chariot co-founder (and, at the time, CEO) Ali Vahabzadeh on its smart cities-focused “City Of Tomorrow Blog.”

In the post, Vahabzadeh explained why he started the company. “In 2014, I founded Chariot to solve my own transit challenges and those of other commuters — people unable to board overpacked buses, or who can’t afford a $20 ride-share downtown at 8 a.m., or who live in a far-flung neighborhood like Outer Richmond,” the native New Yorker wrote.

Vahabzadeh left Ford in February 2018, though he remained chair of Chariot’s board, according to reporting from TechCrunch at the time. Dan Grossman, then Ford’s recently-hired global VP of “microtransit,” took the reins at Chariot and has led the internal startup since Vahabzadeh’s departure.

Erin First, a hired spokesperson for the company, said by phone that continuing Chariot’s service, as it stands, “was not sustainable for the company going forward.” Some employees may be given the opportunity to work for another division in Ford, First said.

Urban mobility is a rapidly-changing market, and with change comes challenges. As more folks move away from car ownership, automakers and transportation service companies alike are vying for the next big business model. Privatized, shuttle-based transportation, a la Chariot, was one experiment in the new way to get around. Scooters, not shuttles, are the new new thing today, and Ford has already jumped into that market by acquiring Spin, a scooter service company. We’ll see how that “mobility smorgasbord” experiment plays itself out.

Updated: This post was updated with further information about co-founder Ali Vahabzadeh’s departure from Chariot.

Illustration: Li-Anne Dias

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