Japan's Honda ties up with ride-hailing service Grab

Yesterday's announcement comes just two weeks after Grab said Japanese financial services company Tokyo Century Corp had made a strategic investment in the firm for an undisclosed amount.
Yesterday's announcement comes just two weeks after Grab said Japanese financial services company Tokyo Century Corp had made a strategic investment in the firm for an undisclosed amount.ST PHOTO: LIM YAOHUI

Move is latest of its kind in auto industry as carmakers seek hedge against shift away from private ownership

South-east Asian ride-hailing service Grab disclosed yesterday that Japan's Honda Motor has invested in the firm - part of a US$750 million (S$1.07 billion) funding announced previously - to collaborate on motorbike-hailing services.

This is the latest tie-up of its kind in the auto industry, where carmakers such as Volkswagen, Toyota and General Motors have also struck deals with ride-sharing firms to hedge against a shift away from private vehicle ownership.

Grab, the biggest rival to ride-sharing service Uber Technologies in South-east Asia, said Honda had agreed to invest an undisclosed amount in the firm, and the two would form a partnership to develop the ride-sharing technology and related driver education programmes.

The Honda investment is a part of the US$750 million funding announced in September, said Mr Ming Maa, president at Grab, which provides services such as taxi- and motorbike-hailing, car-pooling, delivery and mobile payments.

"We are in the planning stages on exactly what a full partnership will look like, and there are many different prongs of that. One prong would obviously include selling Honda motorbikes within the region," Mr Maa told Reuters.

"We would welcome expanding the partnership to four-wheeled (vehicles)," said Mr Maa, who joined Grab in October from Japan's SoftBank Group - an investor in Grab.

The September funding round values Grab at more than US$3 billion, according to a source familiar with the matter.

While the deal with Honda is the first it has signed with a vehicle maker, Mr Maa said Grab was also talking to other vehicle manufacturers for partnerships that will help reduce traffic and increase safety.

Yesterday's announcement comes just two weeks after Grab said Japanese financial services company Tokyo Century Corp had made a strategic investment in the firm for an undisclosed amount.

Investors in Grab include China Investment Corp, Chinese ride-hailing firm Didi Chuxing and Vertex Ventures, a part of Temasek Holdings.

When asked whether the Grab partnership could influence Honda's vehicle designs to adapt to ride-sharing, Mr Maa said "anything is possible".

REUTERS

A version of this article appeared in the print edition of The Straits Times on December 13, 2016, with the headline 'Japan's Honda ties up with ride-hailing service Grab'. Print Edition | Subscribe