Toyota, known as a prominent carmaker Japanese brand, is set to invest over $500 million dollars in Uber. Aside from this, the recent report says both will expand to a partnership that will develop self-driving cars.
According to BBC News, the deal involves mass production of autonomous vehicles, which will be deployed on Uber. Of course, we cannot deny Uber as today's most famous ridesharing network. The partnership values Uber at $72 billion dollars despite the company's mounting losses.
While this is over 15 percent since the investment last May, it already matches the previous valuation in February. In line with this, the official press release from both firms said that the self-driving technology of both companies will be integrated to purpose-built Toyota vehicles.
This new fleet of vehicles will be based on Toyota's Sienna Minivan model. The above-mentioned source revealed that pilot trials will start in 2021. Toyota Motor Corporation's executive vice president Shigeki Tomoyama said that the investment and agreement between two firms mark a significant progress to their transformation as a mobility company.
"We help provide a path for safe and secure expansion of mobility services like ride-sharing," he added. Toyota and Uber are two of those that are behind in developing self-driving cars. Waymo brand own by Alphabet is already paving its way ahead.
On the other hand, Uber halted its self-driving trials after a fatal crash happened in March in Tempe, Arizona. A self-driving SUV reportedly killed a pedestrian. After the tragic incident, the company has removed the autonomous cars from the road and closed the operations in Arizona.
It is safe to say that the company indeed needs external help. Therefore, the partnership with Toyota might deal with these issues and an undeniable opportunity for the Japanese brand as well. Moreover, the report says that they sank over one to two million dollars every single day.
Despite these efforts, the results are still undesirable with an expensive lawsuit, a fatal crash, and no more self-driving mobile on the road compare to Waymo. The Uber investors will find delight as they share the burden, research, and development cost, and strive for initial public offering next year.
Moreover, the shares in Toyota climbed after hearing the reports of the partnership deal. This is not surprising because some analyst believes personal car ownership may drop if the self-driving, ride-sharing will work in the future. Let's look forward to their success!
