Japanese automotive giant Toyota has made a strategic investment in South East Asia taxi-hailing service Grab.
Grab, which competes with Uber, announced on Wednesday that Toyota is investing in a $2 billion (£1.6 billion) plus funding round that was announced in July. Other investors in the round include Japanese tech firm SoftBank and its Chinese equivalent, Didi Chuxing.
Toyota is the latest car company to back a startup aiming to enhance traditional taxi services with technology. Elsewhere Volkswagen backed Israeli founded Gett with $300 million (£232 million), while Jaguar Land Rover backed Lyft in a $25 million (£19 million) round.
Toyota’s investment is being made through Toyota Tsusho, Toyota Group’s trading arm. It will come from the Next Technology Fund, which was established in April to back new technologies and ideas that have potential to revolutionise the automotive industry.
Grab – which currently offers services in 87 cities across Singapore, Indonesia, Philippines, Malaysia, Thailand, Vietnam and Myanmar – has raised around $3.5 billion (£2.7 billion), according to Crunchbase.
It said in July that it will use the money raised in the latest funding round to fuel its growth in South East Asia (home to over 600 million people) and invest in GrabPay, its mobile payments platform.
Grab was founded in 2012 by Malaysian Harvard Business School graduates Anthony Tan and Tan Hooi Ling. Today, the company claims that its app has been downloaded onto over 55 million smartphones and used by 1.2 million drivers.
Separately to the investment from Toyota Tsusho, Toyota Motor Corporation announced on its website on Wednesday that it was beginning a “collaboration” with Grab.
“Through this collaboration with Grab, we would like to explore new ways of delivering secure, convenient and attractive mobility services to our fleet customers in Southeast Asia.” said Shigeki Tomoyama, senior managing officer of Toyota Motor Corporation.
Anthony Tan, cofounder and CEO of Grab, added: “Toyota is a global leader in the automotive sector and one of the most popular brands with drivers on our platform right across Southeast Asia, and we’re excited to work together to explore how we can extend more and better connected car services to our driver partners.
“We are confident this will benefit our driver partners, and we look forward to exploring other ways to collaborate with Toyota in the future.”