Toyota makes record $1 billion investment in ride-hailing firm Grab

Toyota makes record $1 billion investment in ride-hailing firm Grab

Toyota was initially cautious about ride-sharing and autonomous-driving technology. Grab said it plans to work with its new investor "to create a more efficient transport network that will ease traffic congestion in Southeast Asia's megacities" and help its drivers increase their income.

But Toyota had also, in 2016, put money in Grab rival Uber - whose South-east Asian operations were acquired by Grab in March - in a strategic investment.

Toyota put money into Grab via its Next Technology Fund previous year, but this time around the capital comes directly from the parent company.

The two companies already had a relationship: Toyota's trading arm invested an undisclosed amount in Grab past year.

Some automakers have responded by partnering with makers of ride-hailing apps which dominate the fast-growing field of mobility services, in anticipation of a future of reduced auto ownership. The investment is the largest ever of its kind by an carmaker into the ride-hailing industry, according to Grab. It raised $2.5 billion in its last round in July, resulting in a reported value of $6 billion. When Grab claimed the Softbank investment of $US250 million in 2014, it was at the time the largest made into a South East Asian internet company on public record.

The automaker on Wednesday said by deepening the partnership, it hoped to achieve connectivity for Grab's rental vehicle fleet across Southeast Asia and offer financing, insurance and maintenance services to drivers based on data collected on its platform.

"As a global leader in the automotive industry, Toyota's investment in Grab is based on their conviction in our leadership in driving the adoption of new mobility solutions and expanding O2O mobile services, such as GrabFood and GrabPay, in the region", said Ming Maa, president at Grab. This strong partnership will enable us to become the one-stop mobility platform in Southeast Asia.

"Going forward, together with Grab, we will develop services that are more attractive, safe and secure for our customers in Southeast Asia", Toyota executive Shigeki Tomoyama said in a statement. Grab recently took over Uber's Southeast Asia operations after years of competition, and is now going head-to-head in Indonesia with rival Go-jek.

Toyota will place one of its executives on Grab's board, and a second Toyota team member will serve as an executive officer at the company, which Toyota called the "partner of choice for ride-hailing in the region". General Motors Co. and Honda Motor Co. are among carmakers that have invested in ride-hailing applications.

Grab is in eight nations in the region, including Malaysia, Singapore and Indonesia.

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