The transport network vehicle service industry was rocked early last year when Singapore-based Grab acquired the Southeast Asian operations of bitter rival Uber, essentially kicking out the American transport network company from the Philippines and subsequently cornering the bulk of the TNVS business in Metro Manila. To me, however, this wasn’t the biggest news about Grab in 2018. As an automotive journalist, I found Toyota’s sudden involvement in the transport startup more intriguing.
In June, Japan’s leading automaker announced that it was investing $1 billion in Grab. That’s an impressive amount of money whichever way you slice it. It indicates that the car-manufacturing giant is dead serious about the business of app-based ride service. At the time, my reading of the matter was that the move was largely so Toyota could get a head start in the area of data collection.
You see, motor vehicles will eventually be autonomous or driverless whether we like it or not. And for cars to properly operate unmanned, they will need to rely on a myriad of information — including what the busiest hours of the day are, which roads are accident-prone, or even where loading/unloading spots are specifically located. With thousands of Grab cars running around 24 hours a day in most major cities in the region, the TNC is the perfect source of such data.
Indeed, Toyota had installed its in-house-developed driving recorder called TransLog in 100 Grab cars even before it decided to invest in the ride-sharing firm. That project must have yielded fantastic results for Toyota engineers, so much so that their employer wanted to own a stake in the TNC.
And so I assumed that the substantial investment was merely Toyota’s way of preparing for an autonomous-driving future.
In October, a Toyota Motor Philippines (TMP) announcement convinced me that there could be more to the Toyota-Grab partnership than just self-driving vehicles of tomorrow.
TMP rolled out its Grab-specific sales program that offered exclusive deals to existing Grab drivers and operators. This includes easy financing packages via Toyota Financial Services Philippines, which is even throwing in P5,000 worth of free fuel to Grab drivers or operators who will purchase a new Toyota car for their TNVS gig. TMP, for its part, is shaving 30% off periodic maintenance service costs up to 80,000 kilometers of car mileage, as well as a 15% discount on batteries, air-conditioning cleaning, engine detailing and car accessories. The objective, obviously, is to sell more Toyota vehicles.
And then, in December, Toyota Motor Asia Pacific in Singapore held an online teleconference just to say it was implementing its Total-care Service, “a pioneering set of mobility services designed for ride-hailing companies” like Grab. A total of 1,500 Toyota cars owned by Grab in Singapore will benefit from this latest after-sales service initiative, which aims to provide “Grab driver-partners with more cost-efficient and timely maintenance services” based on data collected by the above-mentioned TransLog devices.
But there’s a small part in the press statement that I now wish to call your attention to, and it says: “In addition, both companies will work to increase the share of Toyota vehicles in Grab’s fleet in the region by 25% by 2020.”
Yep, still car sales at the heart of the partnership.
Does Toyota know something its rivals do not? Does the automotive giant now believe that the only way it can sustain its sales growth in the foreseeable future is by supplying vehicles to ride-sharing companies? More important, does Toyota think that car sales in certain markets — quite possibly including the Philippines, where TMP is expected to report a significantly lower sales tally in 2018 compared to the previous year — have plateaued, and that people are gradually but steadily moving away from personal car ownership in the advent of convenient TNC rides?
Funny, but my motoring Website (www.visor.ph) recently published an article about how the Chinese may stop buying automobiles altogether within the next 20 years. In that story, we pointed out how China’s transportation officials are now rapidly developing and perfecting a cloud system designed to interconnect autonomous cars. When this is fully implemented, the report said, Chinese folks will no longer have the need to purchase and own individual vehicles.
Are we moving in this direction? Nah. Thankfully, our government has no such foresight (or the ability to consider what’s best for everyone), so we can expect to still be buying and driving our own cars even when giant robots are already roaming the planet.