TOY­OTA PUMPS $1B IN GRAB

Financial Chronicle - - FRONT PAGE - REUTERS

Toy­ota Mo­tor Corp has agreed to buy a $1 bil­lion stake in South­east Asia’s Grab in the big­gest in­vest­ment by a car­maker into a ride-hail­ing firm.

TOY­OTA Mo­tor Corp has agreed to buy a $1 bil­lion stake in South­east Asia’s Grab in the big­gest in­vest­ment by a car­maker into a ride-hail­ing firm, at a time when tra­di­tional au­tomak­ers are rac­ing to team up with dis­rup­tive tech com­pa­nies.

The value of six-year-old Grab will be just over $10 bil­lion af­ter the in­vest­ment, said a per­son fa­mil­iar with the mat­ter.

The deal comes as the auto in­dus­try faces a spike in the need for tech­no­log­i­cal prow­ess with the ad­vent of fea­tures such as au­tonomous driv­ing, while app mak­ers of­fer pas­sen­gers the op­tion to forgo car pur­chases by con­nect­ing them with driv­ers.

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 car own­er­ship. Gen­eral Mo­tors Co has in­vested in US ride ser­vices firm Lyft, whose ri­val Uber Tech­nolo­gies Inc is also backed by Toy­ota. Mean­while Ja­pan’s Soft­Bank Group Corp – also an in­vestor in Grab and Uber – last month said it would in­vest $2.25 bil­lion in GM’s au­tonomous ve­hi­cle unit Cruise.

Toy­ota’s trad­ing arm in­vested an undis­closed sum in Grab last year. This time, the au­tomaker is lead in­vestor in a fi­nanc­ing round launched af­ter Grab ac­quired Uber’s oper­a­tions in South­east Asia, a re­gion of 640 mil­lion peo­ple.

Grab called it the largestever in­vest­ment glob­ally by an au­to­mo­tive man­u­fac­turer in the ride-hail­ing sec­tor.

The Sin­ga­pore-head­quar­tered firm did not dis­close how much fresh cap­i­tal it aims to raise. It raised $2.5 bil­lion in its last round in July, re­sult­ing in a re­ported value of $6 bil­lion.

Grab said it logs six mil­lion rides a day via apps down­loaded onto over 100 mil­lion mo­bile de­vices. The firm also of­fers on­line to off­line ser­vices, such as food de­liv­ery and digital pay­ments, which it aims to ex­pand deeper into the re­gion us­ing funds from its lat­est fi­nanc­ing round.

“We will work with part­ners like Toy­ota to con­tinue to trans­form trans­porta­tion in South­east Asia,” Grab said in an email. “We want to be the one-stop mo­bil­ity plat­form for users.”

It also said Toy­ota will ap­point an ex­ec­u­tive to Grab’s board of di­rec­tors while a ded­i­cated Toy­ota team mem­ber will be sec­onded to Grab as an ex­ec­u­tive of­fi­cer. Toy­ota said it aimed to of­fer fi­nanc­ing, in­sur­ance and main­te­nance ser­vices to driv­ers based on data col­lected through recorder de­vices al­ready in­stalled in some Grab ve­hi­cles.

“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.

The data could also help Toy­ota de­velop its own next-gen­er­a­tion mo­bil­ity ser­vices, in­clud­ing a self­driv­ing elec­tric ve­hi­cle aimed at com­pa­nies for use in tasks such as ride hail­ing, pack­age de­liv­ery and mo­bile shops.

Other Grab in­vestors in­clude Ja­pan’s Honda Mo­tor Co Ltd, South Korea’s Hyundai Mo­tor Co and Chi­nese ride-hail­ing firm Didi Chux­ing. Uber ac­quired 27.5 per cent of Grab in ex­change for the US firm’s South­east Asian busi­ness ear­lier this year.

Grab’s main ri­val is now In­done­sia’s Go-Jek which last month said it would in­vest $500 mil­lion to be­gin ex­pand­ing abroad.

Pas­sen­gers wait for Grab car out­side a shop­ping man in Kuala Lumpur, Malaysia. Ja­pan's top au­tomaker Toy­ota Mo­tor Corp is in­vest­ing $1 bil­lion in Grab, the lead­ing ride-hail­ing com­pany in South­east Asia, the com­pany said Wednesday

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