Toyota Investing $500 Million in Uber in a Step Towards Autonomous Driving

By Paige Burke — Published August 28, 2018

Toyota Investing $500 Million in Uber in a Step Towards Autonomous Driving

Yesterday saw the partnering of automaker, Toyota and ride-hailing service, Uber. The Japanese automaker has invested $500 million and will be partnering with Uber in an attempt to accelerate the development of an on-demand autonomous ride-hailing service. Following this investment, Uber will be adding Toyota Sienna minivans with autonomous technology. Pilot deployments will begin in 2021.

The companies will be working jointly on this project, primarily in order to lower transportation costs and improve safety and in a world where the world of autonomous vehicles is rapidly growing, this is a smart move on both parts. The Toyota Sienna minivans will be equipped with self-driving technology from Uber and will then be used on their network. These vehicles can then be bought and operated by third-party fleet managers.

Shigeki Tomoyama, the president of Toyota Connected Company, "This agreement and investment mark an important milestone in our transformation to a mobility company." What's more, Uber CEO Dara Khosrowshahi noted in a statement released yesterday afternoon, “Uber’s advanced technology and Toyota’s commitment to safety and its renowned manufacturing prowess make this partnership a natural fit […] I look forward to seeing what our teams accomplish together.  

Ensuring that all costs are met is a priority for Khostowshahi. After months of legal setbacks, he is aiming to take Uber public next year whilst working on maintaining growth and reducing losses at the same time. This partnership with Toyota could be a great way for the ride-share company to lower development costs. Autonomous vehicles are also a great way to cut down on their biggest expense, human drivers. What's more, it's a great way for them to show the public that they are dedicated to putting safety first, especially following a fatal crash involving one of its cars earlier this year.

Companies will be calling this latest development an "Autono-MaaS" fleet. This is a term referring to providing 'autonomous-mobility as a service' via Uber's autonomous driving system and Toyota's technological developments. Toyota will be working on developing fully autonomous cars to serve elderly and disabled individuals seeking independence. In addition, they will also be working on cars for able-bodied people whom will be able to switch between assisted and full autonomy. This technology which it is referring to as "Guardian", will operate silently in the background.

“Uber’s automated driving system and Toyota’s guardian system will independently monitor the vehicle environment and real-time situation, enhancing overall vehicle safety for both the automated driver and the vehicle,” commented Dr. Gill Pratt, Toyota Research Institute CEO in a recent statement.

Monday's announcement didn’t come as a surprise seeing as Toyota and Uber had a pre-established relationship. The companies already announced the birth of e-Palette, an autonomous vehicle concept that can be used anywhere from delivery service (think anywhere from pizza to Amazon packages) to ridesharing, at the International Consumer Electronics Show in January 2018.

Finally, we have no doubt that the $500 million investment from Toyota was useful, to say the least. Running a self-driving car program doesn’t come cheap. Engineers are rare meaning salaries are high and maintaining a large fleet of test vehicles brings additional costs of their own too.

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