The deal comes as the auto industry faces a spike in the need for technological prowess with the advent of features such as autonomous driving, while app makers offer passengers the option to forgo vehicle purchases by connecting them with drivers. Honda also invested in Grab in a partnership aimed at expanding motorcycle-hailing operations in Southeast Asia.
On April 8, Uber's rideshare service disappeared and commuters in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam switched over to the Grab app.
When asked about other investors in this round, a Grab spokesman told The Business Times: "Toyota will be one of our lead investors for this round".
Toyota's trading arm has previously invested in Grab, which also counts Chinese peer Didi Chuxing and Japan's SoftBank Group Corp as investors. It raised $2.5 billion in its last round in July, resulting in a reported value of $6 billion.
Toyota Motor Corp has agreed to invest USD1 billion in Southeast Asian ride-hailing firm Grab as a lead investor in the company's ongoing financing round.
FILE PHOTO: A man walks past a Grab office in Singapore March 26, 2018.
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This is Toyota's second investment in Grab.
The fresh funds will allow Grab to further expand services such as its food delivery service GrabFood and mobile payments GrabPay to more countries across the region. This strong partnership will enable us to become the one-stop mobility platform in Southeast Asia.
A Toyota executive will be appointed to Grab's board and another Toyota representative is being tapped to be an executive officer at Grab, the company said. In particular, that will involve close collaboration with the Toyota Mobility Service Platform (MSPF), which is working on areas such as user-based insurance, new types of financial packages and predictive auto maintenance.
Grab, which is headquartered in Singapore, is a leading player in the ride-share industry in Asia, and earlier this year agreed to acquire USA giant Uber's regional operations. "Going forward, together with Grab, we will develop services that are more attractive, safe and secure for our customers in Southeast Asia", said Shigeki Tomoyama, Toyota Executive Vice President and President of Toyota's in-house Connected Car Company.
Last month, Indonesian ride-hailing and online payment firm Go-Jek said it would enter Vietnam, Thailand, Singapore and the Philippines in the next few months, investing $500 million in its worldwide push.
Grab's main rival is now Indonesia's Go-Jek which last month said it would invest $500 million to begin expanding overseas.