SINGAPORE - Toyota Motor Corp will invest US$1 billion (S$1.34 billion) in Singapore-based Grab, in the largest investment by an automotive manufacturer in the global ride-hailing sector.
Toyota is investing as a lead investor in Grab’s ongoing financing round, Grab said in a statement on Wednesday (June 13).
When asked about other investors in this round, a Grab spokesman told The Business Times: “Toyota will be one of our lead investors for this round. We are not disclosing our other investors at this point but are excited by the quality of investors who are interested in partnering with Grab.”
The Japanese giant’s investment values Grab, South-east Asia’s largest car-hailing service, at just over US$10 billion, Bloomberg reported. That makes it still smaller than Uber, which was valued at US$62 billion in a stock deal announced in May, and China’s Didi Chuxing at at US$56 billion after a fundraising round in December.
This is Toyota’s second investment in Grab. Last year, its trading arm, Toyota Tsusho Corp, injected an undisclosed amount in Grab, and the companies have worked together since August developing connected services. Toyota has installed its data recorders in Grab-operated rental cars to collect driving data – a similar strategy it has employed with Japan Taxi, said Bloomberg.
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. The investment amount was not disclosed. As part of its investment, Toyota would partner Uber to create a leasing programme for new Uber drivers and explore additional mobility services.
Under the agreement between Grab and Toyota, both players will strengthen and expand their existing collaboration in the area of connected cars - to drive the adoption of new mobility solutions across South-east Asia.
Grab will work with Toyota on how connected car services on the Toyota Mobility Service Platform – such as user-based insurance, financing programme and predictive maintenance – can enrich the Grab experience for drivers on the Grab platform.
Grab and Toyota will roll out connected car services, such as telematics-based insurance, which could reduce the cost of insurance premiums for safer Grab drivers, said Grab.
Grab added that the investment will allow Grab to further expand its range of online-to-offline services, such as GrabFood and GrabPay, deeper into the region.
One Toyota executive will be appointed to Grab’s board of directors, and a dedicated Toyota team member will be seconded to Grab as an executive officer.