Japanese automotive manufacturer Toyota’s trading arm Toyota Tsusho has announced to invest in Grab, which is expected to raise $2.5 billion, led by Chinese peer Didi Chuxing and Japan’s SoftBank Group Corp, according to a Reuters report.
The report added Grab’s new fund raising of $2.5 billion would escalate the valuation of the company to $6 billion.
However, Toyota Tsusho’s investment amount into the Singapore-based ride-hailing firm has remain undisclosed. Last year, Toyota had also made a strategic investment in Uber.
Besides, Toyota will also install its driving recorder devices in the vehicles operated by Grab.
The report said that under a pilot programme, Toyota will have its TransLog device installed into 100 Grab rental cars, enabling the companies to analyse driving patterns as well as offer improved access to connected car services.
The investment comes as Toyota rival Honda invested an undisclosed amount in Grab in December last year, to collaborate on motorbike-hailing services.
The Singapore-based company is one of the top operators in the ride-hailing space in SouthEast Asia region. It operates in 36 cities across seven countries in Southeast Asia, where it claims over 50 million downloads from users and 1.1 million drivers on its platform.
Grab claims to have a market share of 95 percent in third-party taxi-hailing and 72 percent in private-vehicle hailing in Southeast Asia.
In Southeast Asia, there is intense competition between Uber, Go-Jek and Grab. In the ride-hailing space world over, local players have been showing greater initiative in terms of launching services such as digital payments, Ajay Sunder was quoted by sources, who is vice president of digital transformation at Frost & Sullivan in Singapore.
Of late, Grab has been making acquisitions and foraying into new services and using technology to address transportation and payments.
But the twist in the story awaits as San Francisco-based Uber is planning to increase its focus on the region after it folded its China business into Didi last year.
The new investments by traditional automakers such Toyota, Honda, Volkswagon and General Motors into the ride-hailing firms point out towards a new market away from private ownership.