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Toyota (TM) to Extend Alliance With Uber & Invest $500M

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Toyota Motor Corporation (TM - Free Report) has announced expanding its partnership with Uber Technologies Inc. (Uber), with an aim to develop and launch its autonomous ride-sharing as a mobility service in the market. Additionally, Toyota will invest $500 million in Uber.

In sync with the target, technology from both the companies will be incorporated into Toyota’s vehicles and will be deployed in Uber’s ride-sharing network. Per Toyota’s management, the collaboration extension and investment will enable it to offer safe, and secure mobility services to customers by using the Japanese automaker’s technologies and vehicles.

Further, Toyota and Uber expect the mass-manufactured self-driving vehicles to be owned and managed by third-party autonomous fleet operators, which are going to be chosen collectively.

Toyota Motor Corporation Price and Consensus

 

Toyota’s Guardian automated safety support system and Uber’s autonomous driving system will be incorporated into the "Autono-MaaS" (autonomous-mobility as a service) fleet. Moreover, Toyota’s core information infrastructure designed for connected vehicles, i.e. Mobility Services Platform (MSPF), is also going be used in Autono-MaaS. At first, Toyota's Sienna Minivans platform will be used for operating the autonomous fleet.

Like its peers, Toyota plans to start testing self-driving vehicles by 2020. For this, the company is making R&D investments at its own self-driving software developing units as well as other companies. Earlier in May 2018, the company announced its plan to team up with ALBERT Inc. to analyze big data for the advancement of automated driving technology. Additionally, an investment of ¥400 million was initiated by Toyota in exchange for ALBERT’s shares.

Price Performance

In the past six months, Toyota’s stock has lost 6.1%, outperforming 13.6% decline recorded by the industry it belongs to.

 



Zacks Rank & Key Picks

Toyota currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (ALSN - Free Report) , Fox Factory Holdings Corporation (FOXF - Free Report) and Honda Motor Co., Ltd. (HMC - Free Report) . Allison Transmission and Fox Factory sport a Zacks Rank #1 (Strong Buy) while Honda carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Allison Transmission has an expected long-term growth rate of 10%. Shares of the company have risen 24.5% in the past six months.

Fox Factory has an expected long-term growth rate of 16.8%. Over the past six months, shares of the company have gained 73.2%.

Honda has an expected long-term growth rate of 3%. Over the past year, shares of the company have gained 9.2%.

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