Toyota and Volkswagen are the latest makers to announce deals with ride-sharing companies. Toyota is teaming with Uber.
The number of major automakers entering the ride-sharing realm continues to grow, Toyota and Volkswagen just the two latest.
The Japanese maker has announced a broad alliance with Uber, the world’s largest ride-sharing service, with a $1 billion investment. Volkswagen, meanwhile, is investing $300 million in Gett, a global ride-hailing service. The two announcements come just months after General Motors said it would launch car-sharing service Maven and invest $500 million in Uber’s largest competitor, Lyft.
“Ridesharing has huge potential in terms of shaping the future of mobility,” said Shigeki Tomoyama, senior managing officer of Toyota and president of its new subsidiary, the Connected Company. “Through this collaboration with Uber, we would like to explore new ways of delivering secure, convenient and attractive mobility services to customers.”
Under its memorandum of understanding, Toyota will run trials in a number of global markets where Uber now operates. A key goal is to generate additional sales to Uber drivers, offering them reduced-rate loans and financing through its captive finance subsidiary Toyota Financial.
(Uber latest company to begin testing autonomous vehicle program. For more, Click Here.)
That’s along the same lines as Express Drive, a new service GM will offer to Lyft drivers. They get a cut-rate deal on GM vehicles such as the Chevrolet Equinox – and the fee is waived entirely if they book enough rides each week.
Volkswagen is partnering with Gett for its ride-sharing program. VW wants to be a "mobility leader" by 2025
As for Volkswagen, it is pumping $300 million into Gett, an aggressive Uber rival based in Tel Aviv that now operates in 60 countries worldwide. That includes much of Europe but only New York City in the U.S. Gett operates on a flexible model, in some cases allowing riders to hail black cabs. But in others, including Israel, it provides a fast way to get a conventional cab. Gett also handles logistics and delivery services.
“On-demand ride booking is growing rapidly. In that context, Gett provides the Volkswagen Group with the technology to expand beyond car ownership to on-demand mobility for consumers,” said Shahar Waiser, the start-up’s CEO. “Further, both companies are equally successful with consumers and businesses; and VW will now be able to expand its leadership position by also offering on-demand rides to the B2B market.”
(To see more about GM’s newly launched car-sharing service, Click Here.)
From his perspective, Volkswagen CEO Matthias Mueller said the company aims “to become one of the world’s leading mobility providers by 2025.”
It’s hard to find a major automaker that isn’t entering the alternative mobility arena. Daimler AG, for example, participates in several different ventures, such as Car2Go, with its Mercedes-Benz and Smart brands. BMW partners with car-sharing services such as ReachNow.
Ford works with ZipCar, and it also has set up a number of different ride- and car-sharing programs of its own in the U.S. and overseas. The second-largest U.S. automaker has said it no longer wants to be viewed as a car manufacturer but, rather, as a mobility services firm. CEO Mark Fields notes that annual global sales and service of new and used vehicles generate about $3 trillion in revenues. But mobility services come in at $5 trillion, of which automakers get a very small slice.
(Apple invests $1 billion in Chinese ride-sharing company Didi. Click Here for the story.)
Another reason behind the spate of alliances and investments is the auto industry’s fear that car- and ride-sharing services could put a serious dent into the sale of new vehicles in the years ahead. Travis Kalanick, CEO of Uber has predicted that once fully self-driving vehicles are available it will be cheaper to for motorists ride with the service than for them to own and operate a vehicle of their own.