Toyota is now eyeing a piece of the pie in the growing ride-hailing industry with the announcement of a new partnership that will form a new mobility joint venture in China. The Japanese carmaker announced that it will be investing $600 million in Chinese ride-hailing giant Didi Chuxing as part of its push to enter the budding Asian ride-hailing market.
Toyota, through its automotive manufacturing venture based in the Guangzhou, and Didi Chuxing will be forming a new joint venture that will give the Chinese company an edge over its competitors in its home market. With the added investment and the support of GAC Toyota Motor Co, the new joint venture company will have Toyota's full car maintenance support.
In a joint statement released by both companies, it was revealed that the expanded company in China will be using Toyota's proprietary Mobility Services Platform. The platform will provide the new joint venture company with advanced vehicle management, insurance, maintenance, and comprehensive financing for both drivers and consumers. Toyota also revealed that it will be pushing for the widespread use of full-electric vehicles for the new joint venture company.
For its part, Didi Chuxing will be offering its expertise in AI-based large-scale vehicle operations to aid the new joint venture. According to Didi Chuxing senior vice-president, Stephen Zhu, both company's class-leading technologies should result in the establishment of an intelligent mobility framework for China and its future sustainable cities.
Didi Chuxing has been busy building alliances within the industry to take on new competitors. Last month, the company made an undisclosed investment in a new Tencent-backed ride-hailing startup called OnTime. According to the company, the investment was to ensure its strategic alliances within China.
Toyota's investment in Didi Chuxing comes at a very opportune time as the Chinese firm struggles to compete with new startups in the industry. Startups such as T3, which launched trail operations in Nanjing earlier in the month, are being backed by tech giants that are also offering proprietary technologies. T3 currently has the backing of Alibaba, Suning.com, and state-owned carmakers FAW Group and Dongfeng Motor Corp.
Last month, ride-hailing platform Meituan Dianping launched its services in 10 major cities, including Beijing. The service allows users to compare offers from various ride-hailing services, including Geely's Shouqi and Caocao Car.
Alibaba also just entered the industry with the addition of its own aggregate ride-hailing platform integrated into its AutoNavi maps app. The app from the e-commerce giant currently has more than 100 million daily users, giving it a big advantage over other platforms.
