Lyft Inc., which makes a mobile application for ride-sharing, is acquiring Corral Labs Inc. to expand its carpooling business as competition with Uber Technologies Inc. mounts.

Corral Labs makes Hitch, an app for San Francisco consumers that lets them coordinate rides with other people who are going in the same direction, akin to carpooling. Terms of the deal weren’t disclosed. Hitch’s drivers and employees will be asked to join Lyft and its service will close, Lyft said.

Lyft and Uber both added services in August — Uber Pool and Lyft Line — that let people do the equivalent of carpooling, in a race to be the dominant car-hailing service. The two San Francisco-based startups have also slashed ride prices and fought to recruit each others’ drivers as they expand their services to metropolitan areas worldwide.

Uber in June raised $1.2 billion in a round of financing that valued the company at $17 billion, while Lyft raised $250 million from investors including Alibaba Group Holding Ltd in April.

“We’re very early on in terms of where the product can be in a few years,” Lyft Chief Technology Officer Chris Lambert said in an interview. “The Hitch team will definitely help us expand to more markets.”

Lambert said he was impressed with some of Hitch’s technology, such as a way to see whether someone you’re carpooling with has shared interests or friends.

Lyft previously made two acquisitions, including of Cherry, which made an on-demand car-washing app, and transit company Rover.

Corral Labs, which is also based in San Francisco and was co-founded by Snir Kodesh and Noam Szpiro, is backed by investors including Winklevoss Capital, Kima Ventures and Scott Banister.

To contact the reporter on this story: Sarah Frier in San Francisco at To contact the editors responsible for this story: Pui-Wing Tam at Reed Stevenson

Tags: apps, cars, lyft, uber
Photo Credit: Lyft will acquire car-pooling app Hitch. Lyft