Toyota invests $600 million in Didi to set up a joint venture
Following the big news of Didi’s planned expansion to the Middle East through a joint venture with Symphony Investment and other investors in the UAE, there is a new joint venture on the horizon — this time with Toyota.
Didi Chuxing, the world’s leading transportation platform acquired Uber China in 2016, Brazil’s 99 in 2018, and has invested in Careem, Grab, Lyft, Bolt and Ola. Furthermore, it has expanded from China to Japan, Australia, Latin America, and is continuing its streak to become the world leader in Mobility as a Service.
As part of its portfolio, it has set up strategic alliances to offer car servicing and other automobile solution to drivers in its network. Earlier these alliances have been with top Chinese and international carmakers including Volkswagen and Renault-Nissan-Mitsubishi.
Now, we learn that Toyota has invested $600 million in Didi. This deal will see the set up of a joint venture between Didi and Toyota’s Chinese establishment, GAC Toyota Motor, a JV itself with GAC Group, one of China’s largest automakers.
This new joint venture will offer vehicle-related services to drivers on the ridesharing platform, which will help drivers keep vehicles serviced, in good condition and allow for easier repairs.
"I am delighted that we are strengthening our collaboration – which utilizes Toyota's connected technologies and next-generation BEVs – with DiDi, China’s mobility service market leader. Looking ahead, we will work with DiDi to develop services that are more attractive, safe and secure for our customers in China."Shigeki Tomoyama, Toyota Executive Vice President
The joint venture will help extend Didi’s D-Alliance, a “mobility + automotive industry alliance strategy.”
We have earlier written how the future of mobility and ride-sharing sector depends heavily upon partnerships between tech companies offering platforms for the service and car manufacturers. As the world becomes more mobile, with younger generations moving to live abroad, cautious with large-value commitments, the sale of individually owned cars are on a decline.
Car manufacturers need to expand their business model to focus on fleet owners and aggregators, and service provider platforms. Ford signed an exclusive deal with Egypt’s Swvl in this attempt, where all of Swvl’s cars will be from the Americal auto giant.
Uber is under pressure for its non-employee drivers not receiving many benefits, even though many of them drive full-time. Catering to drivers’ needs is an essential aspect for the success of any ride-sharing platform. Even though they are not direct employees, them being happy and being encouraged to service their vehicles will go a long way in providing better experiences to them as well as the customers.
