South Korea’s Hyundai Motor Co said on Thursday it had invested in Southeast Asian ride-hailing firm Grab, as it seeks to expand into the rapidly growing region following a sales slump in China.
Hyundai’s first direct investment in a ride-hailing firm gives it a “foothold” in the world’s third-biggest ride-hailing market after China and the United States, it said.
Singapore-based Grab, the biggest operator in the region’s third-party taxi hailing and private-vehicle hailing sector, has expanded to eight Southeast Asian countries.
“The deal should help raise the exposure of Hyundai Motor in the region, while responding to the future mobility market,” said Lee Sang-hyun, an analyst at IBK Securities.
Hyundai’s interest in Southeast Asia has grown since South Korean companies were targeted last year in a Chinese backlash over Seoul’s decision to deploy a U.S. missile defense system against Beijing’s objections.
The region of about 500 million people is dominated by Japanese carmakers, while Hyundai has focused on China and the United States.
Hyundai and Grab said they would jointly develop services in Southeast Asia, including one utilizing Hyundai’s eco-friendly models such as the IONIQ Electric. They did not disclose the value of Hyundai’s investment.
Hyundai last week announced for the first time a self-driving technology partnership with Silicon Valley start-up Aurora, a shift from its usual preference for developing technology itself.
The Hyundai tie-up is part of Grab’s latest financing round that raised $2.5 billion and included Chinese peer Didi Chuxing, Japan’s SoftBank Group Corp and Toyota Tsusho, a Grab spokeswoman said.
Hyundai Motor vice chairman Chung Eui-sun said on Wednesday it is considering building a car plant in Southeast Asia, possibly in Indonesia or Vietnam.