June 13, 2018—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, Reuters reports.
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.
General Motors Co has invested in U.S. 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.
As ride sharing programs like Uber and Lyft continue to grow, one of the main questions is how these vehicles will be serviced. Ratchet+Wrench recently covered what some of the industry’s behemoths are doing in regards to ride sharing partnerships, and how independents can react.