(June 13): Toyota Motor Corp. will buy a US$1 billion ($1.3 billion) stake in Grab in one of the largest investments by a carmaker in a ride-hailing provider, underscoring the push by the auto industry to move from manufacturing to services.

The deal extends Toyota’s cooperation with Grab, the largest ride-hailing service in Southeast Asia, the carmaker said in a statement Wednesday, without disclosing what percentage of Grab it will own. A Toyota executive will be appointed to Grab’s board, and another Toyota employee will be seconded to Grab to as an executive officer.

The car industry is racing with technology companies to gain ground in mobility services such as vehicle sharing and ride hailing, which are set to reduce the need for auto ownership. Toyota has also backed San Francisco-based Uber Technologies Inc. and made investments in Japan Taxi, an Uber rival run by the chairman of Tokyo’s biggest taxi operator.

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