Nothing seems to be going in favor of Uber, which appears to be struggling in every area of its major market. Now, in Japan, Toyota has announced that it would invest 7.5 billion JPY ($69 million) into JapanTaxi – a rival to Uber.
JapanTaxi is owned by Ichiro Kawanabe, who is also the owner of Japan’s largest taxi operator – Nihon Kotsu – and head of the country’s taxi federation. Toyota will acquire the freshly issued shares in JapanTaxi through a private placement this month. Further, the automaker will work with JapanTaxi in areas such as data collection and analysis along with in-vehicle terminals.
Also, the new dispatch support system, which both JapanTaxi and Toyota are planning to develop together by fiscal 2018, will sit on artificial intelligence. This new system from JapanTaxi would work towards analyzing data to find peak demand times and locations to make ride-hailing more efficient, notes Nikkei.
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Toyota’s investment in the ride-hailing company – JapanTaxi – comes at a time when consumers are shifting away from vehicle ownership. Toyota is already an investor in Uber and Singapore’s Grab with a focus on finding new possibilities in the transportation services. However, its investment in Uber was not received well from the Japanese taxi companies, notes Nikkei.
Toyota’s President Akio Toyoda has big plans for the company and its role in the future of transportation. The automaker believes that cloud computing and data are the next big things and are powerful enough to disrupt and present opportunities for a new stream of revenue amid a shift towards connected, autonomous and electrified vehicles.
In short, Toyoda is aiming to redefine the veteran car manufacturer as a mobility services provider. “Now that Toyota has invested in JapanTaxi, the issue to look at is Uber’s expansion and strategy in Japan,” said Seiji Sugiura, an analyst at Tokai Tokyo Research Center in Tokyo, according to Bloomberg.
Uber has had only a little success in Japan so far, accounting for less than 1% of the monthly rides in Tokyo. Further, Kawanabe – also known as the “Taxi Prince” and the owner of JapanTaxi – wants to ensure that Uber remains on the sidelines of Japan’s ¥1.72 trillion taxi industry. However, Brooks Entwistle, head of the company’s business in the region, says that Uber will expand its services in Japan, Singapore and other parts of Asia, notes The Japan News.
Adding further to Uber’s woes in Japan, the Chinese ride-hailing giant Didi Chuxing and partner Softbank is planning to provide ride-hailing and other services for the Japanese taxi industry. This latest move would be another effort from Didi to acquire a major share of the market outside China, along with challenging arch-rival Uber.
Prior to starting the service, both the companies will go through the local market conditions and policies, along with gaining insight into the market by engaging with the industry practitioners, stakeholders and policymakers. The joint venture is aimed towards building an open and inclusive platform that will be available to all of Japan’s taxi operators.
Didi and Softbank would start trial services in Japan sometime this year, according to CNBC. Softbank is already an investor in Didi.