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Wireless Technologies

Auto manufacturers start picking sides for the future

Today, Toyota announced that it was making a “strategic investment” in taxi-app Uber as part of a partnership between the two companies. Yesterday, Volkswagen announced a $300 million investment in European taxi-hailing app Gett. In January, General Motors ploughed $500 million in Lyft. Spot a trend?

Three major automobile manufacturers, three sizable (Toyota’s is reportedly around $100 million, according to the WSJ) investments in three separate on-demand car hailing apps. Coincidence?

Of course not. Car makers are worried. The rise of on-demand mobility and a future filled with fewer driverless cars could drive car-ownership down massively. And if your business is making cars, that’s a scary prospect. A shift to services and data are key to staying in the game.

A consortium of car companies recently bought Nokia’s HERE maps in order to try and shut out Google, Apple etc. while at the same time resisting technology companies trying to muscle their way on to the dashboard. Investments in car-hailing is merely another step in keeping relevant and staving off competition from Silicon Valley’s biggest names.

BMW has already launched its own premium “AirBnB for cars” in Seattle, and promised driverless cars in the future. Google, one of the biggest names in driverless cars, recently added carpooling to its Waze service, which itself now comes baked-in to Android Auto. Even Apple – long rumoured to be working on some sort of driverless iCar - made a ten-digit investment in an Asian Uber rival as a possible future stepping stone.

People might still be wary about the concept of driverless cars for now, but few predict the technology won’t gain traction quickly once the public get over the initial fear of handing over control. And if the vision of cities filled with co-owned pods summoned on demand comes to fruition, the car manufacturers don’t have much wiggle room to get it wrong against the might and money of the Valley. Expect more such investments, partnerships, and probably even acquisitions on the horizon.

 

Additional reading:

Is Apple’s $1 billion stake in Didi a good strategic move?

What does the future of driverless cars look like?

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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