Mobility Company or Automaker? Toyota Signs MOA with Uber

The latest 2016 Prius is longer, lower and wider than the model it replaced – a throwback to 1950’s car marketing. The Uber deal is the complete opposite.

Toyota Motor and Uber have entered into a memorandum of understanding (MOU) to explore “collaboration,” starting with trials, about ridesharing in countries where ridesharing is expanding. This is a complicated deal, given Uber’s current legal and regulatory challenges in the U.S., as well as global business conditions and regulations, and – at the end of the road – consumer desires.

Clearly though that this is the latest development that signals automakers are recognizing that their traditional business model of selling and – increasingly – leasing a vehicle is threatened by next gen customers who are looking for better ways to get about.

Toyota said: “Against the backdrop of rapidly evolving car usage trends in recent years, the development of mobility services in new areas, including ridesharing and car-sharing, has gathered pace on a global scale. Through this agreement on the trials, Toyota and Uber will accelerate further talks in aiming to establish new services and to offer new value to customers.”

The immediate outcome seems to be another fleet sales program because the companies will create “new leasing options in which car purchasers can lease their vehicles from Toyota Financial Services and cover their payments through earnings generated as Uber drivers.”

Whether the lessees will be vetted for criminal backgrounds was not stated. Toyota Financial Services Corporation and Mirai Creation Investment (Toyota and Sumitomo Mitsui Banking are shareholders in this hedge fund) are also making an investment in Uber.

“The leasing period will be flexible and based on driver needs. This initiative builds on Uber’s current Vehicle Solutions program,” the companies said in a release.

“Ridesharing has huge potential in terms of shaping the future of mobility. Through this collaboration with Uber, we would like to explore new ways of delivering secure, convenient and attractive mobility services to customers,” said Shigeki Tomoyama, senior managing officer of Toyota Motor Corporation and president of the Connected Company, one of Toyota Motor Corporation’s recently created in-house companies.

Toyota and Uber will also explore collaboration in a other ways, such as developing in-car apps that support Uber drivers, sharing knowledge and accelerating their respective research efforts, and establishing a special fleet program to sell Toyota and Lexus vehicles to Uber.

About Ken Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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