South-Korean carmaker, Hyundai Motor will be investing up to $250 million into the e-hailing ride service, Grab. This comes as Hyundai’s second investment after its initial pouring earlier this year.
According to Financial Times, investment by Hyundai takes Grab’s funding this year to $2.7bn, with the company aiming to raise $3bn by the end of the year.
The upcoming investment will be coupled with 200 Hyundai electric vehicles in Grab’s Singapore in 2019, with the intention to expand further in the region. Both services are planning to further launch potential pilot programs aimed at making their mark in electric vehicle-friendly markets across South East Asia.
The electric vehicle-friendly pilot programs will also involve an affiliate of Hyundai, Kia Motors to help boost growth as well as aid Grab to minimise their cost while expanding across the SEA markets. Reports also show that the expansion might penetrate into the Malaysian and Vietnamese markets as well in time to come.
While this is one of the biggest investment by Hyundai, it is still relatively small compared to other investors such as Toyota Motor Corp. While the carmaker’s stock prices has seen a downfall, this investment might be able to create a shift.
Furthermore, the move by Hyundai to partner with Grab is seen as a solution for the decline of individual ownership of vehicles as ride-sharing platforms are an increasing traction among users.
“Not only Hyundai, but all global auto manufacturers have realized that generating revenue solely from selling vehicles is not a sustainable, viable option,” Hyundai’s chief innovation officer, Chi Young-cho, told reporters in Seoul
Hyundai is also expecting to release its very own ride-hailing service in selected markets sometime next year. The carmaker giant is also looking at acquisition markets.