Toyota repeats Grab playbook in China
Outside of its domestic market, Toyota continues to invest in various mobility solutions. The Japanese playbook is starting to become clear: Toyota looks for successful businesses rather than start-ups, the brand looks at collaborative models rather than funding and its focus is on connectivity services. Then endgame is essentially to become a preferred vehicle supplier to a new type of large volume customers – the mobility industry – and acquire data and knowledge from the industry on the go.
Previously, Toyota has forged a similar deal with South-East Asia’s largest ride hailer, Grab. It offers a suite of solutions for Grab drivers, such as financing solutions, maintenance programs and attractive insurance rates. In exchange, Grab promotes Toyota to its drivers and allows Toyota to install some hardware that connects the car and transfers data to the Japanese OEM.
Toyota and Didi have been working together since 2018; a trial year that replicates exactly the first steps of collaboration with Grab. During this period, Didi and Toyota tried out Toyota’s e-Palette, its flexible EV platform and Toyota offered leasing and several car related services via Toyota dealers in China.
This time around, the partnership extends those services to vehicle management, insurance, MRT and financing tools. The Didi cars will be equipped with Toyota’s Mobility Services Platform which shares the usage data on Toyota servers.
A new company
Toyota is investing USD 600 million in the partnership, materialised by a capital increase of Didi and the creation of a new joint venture between Didi and GAC Toyota Motor Co. (or “Toyota China”). Next to increasing revenues for Toyota’s dealer networks and financial product lines, there’s a huge potential for the Japanese to play a more significant role in the Chinese EV market. Toyota is placed forth on the Chinese market with about 1.47 million registration, thanks to the Corolla and the Rav4. In terms of volumes, this is comparable to what Honda (1.43 million units) and Nissan (1.56 million) are realising – an awkward situation for a brand that tops the rankings in almost all Asian countries.
Comments from Toyota and Didi
The young SVP of Didi, Stephen Zhu, shared with the press that “(they) look forward to combining DiDi's expertise in AI-based large-scale mobility operations and Toyota's leading connected vehicle technology to build a next-generation intelligent transportation framework for sustainable cities." Toyota’s EVP Connected Vehicles alluded to Didi’s safety issues in 2018, by saying “we will work with DiDi to develop services that are more attractive, safe, and secure for our customers in China."