SEOUL • South Korea's Hyundai Motor said it had invested in South-east Asian ride-hailing firm Grab, as it seeks to expand into the region to reduce its reliance on China following a damaging diplomatic row between Seoul and Beijing.
Hyundai's first direct investment in a ride-hailing firm gives it a "foothold" in the world's third-biggest ride-hailing market after China and the United States, it said yesterday.
The two companies did not disclose the value of Hyundai's investment.
Singapore-based Grab, the biggest operator in the region's third-party taxi hailing and private-vehicle hailing sector, has expanded to eight South-east Asian countries.
"The deal should help raise the exposure of Hyundai Motor in the region, while responding to the future mobility market,"said IBK Securities analyst Lee Sang Hyun.
Hyundai's interest in Southeast Asia has grown since South Korean companies were targeted last year in a Chinese backlash over Seoul's decision to deploy a United States missile defence system against Beijing's objections.
The South-east Asian region of about 500 million people is dominated by Japanese carmakers, while Hyundai has focused on China and the US.
Hyundai is also looking to catch up with its peers in future mobility, the personal transport innovations from ride-sharing to self-driving cars that are expected to reshape the auto industry.
While it does offer car-sharing services in the US and Europe, until now it has watched from the sidelines as competitors like GM and Toyota have allied with ride-sharing partners.
Hyundai and Grab said they would jointly develop services in South-east Asia, including one utilising Hyundai's eco-friendly models such as the IONIQ Electric.
Hyundai last week announced for the first time a self-driving technology partnership with Silicon Valley start-up Aurora, a shift from its usual preference for developing technology itself.
The Hyundai tie-up is part of Grab's latest financing round that raised US$2.5 billion (S$3.3 billion) and included Chinese peer Didi Chuxing, Japan's SoftBank Group and Toyota Tsusho, a Grab spokesman said.
Hyundai Motor vice-chairman Chung Eui Sun said on Wednesday it is considering building a car plant in South-east Asia, possibly in Indonesia or Vietnam.