Toyota Invests $500 Million in Deal with Uber In Race To Make Autonomous Vehicles
According to Bloomberg and many different sources this week, Uber Technologies Inc. will be receiving a $500 million dollar investment from the Japanese automaker Toyota Motor Corp. The investment comes as Toyota’s effort to catch up on self-driving technology. With General Motors Co. and Alphabet Inc.’s Waymo leading the race in autonomous vehicles, the Japanese company is looking to catch up.
With this deal in place, Toyota will now manufacture Sienna minivans that will be loaded with Uber’s software. The testing will begin on Uber’s ride-sharing network in 2021. With Toyota’s new stake in Uber, the ride-hailing company is predicted to be valued at $72 billion. This investment is not Toyota’s first in a ride-sharing company. Toyota put $1 billion into Southeast Asia’s Grab Holdings Inc. earlier in 2018 and also has a partnership with China’s Didi Chuxing Inc. Japan Taxi, a rival of Uber is also backed by Toyota.
Both carmakers and technology companies are laboring toward a future with autonomous robotic taxis. Toyota is placing bets across the board for a shot at these beginning technologies which boast the ability to change the traditional way of making and selling cars to individuals.
The big three ride-hailing companies- Uber, Didi, and Grab- are all backed by SoftBank Group Corp., a Japanese internet giant. Masayoshi Son, the founder of SoftBank, has invested $9.5 billion into Didi, another $9.3 billion in Uber, and also has stakes in Grab and India’s Ola. Son also is an investor in GM’s Cruise autonomous car unit.
Technology companies need the automakers to bring these unruly ideas to life with their knowledge of car manufacturing and their factories and facilities to do it.
Toyota is partnering with Uber and Didi to make the vision of a fleet of autonomous, modular boxes that can shop anything from people to food a reality. The concept, dubbed e-Palette, was unveiled at CES in Las Vegas in January, and both Amazon.com Inc. and Pizza Hut signed on.
Eric Meyhofer, head of Uber’s Advanced Technologies Group stated, “Since 2015, we’ve been working to bring safe, reliable self-driving technology to the Uber network. We knew we couldn’t do it alone, which is why we continue to partner with world-class vehicle manufacturers to make our vision a reality.”
Both Uber and Toyota expect that the mass-produced autonomous vehicles will eventually be owned and operated by a third-party company that will be agreed upon mutually.
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