Toyota captures data goldmine in $1 billion Grab bet

Toyota said it aims to install its TransLog driving recorder devices into Grab’s fleet of lease cars to access the data on driving patterns that will be crucial to its push into the nascent mobility-as-a-service industry. (AFP)
Updated 20 June 2018
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Toyota captures data goldmine in $1 billion Grab bet

  • Grab already monitors driving behavior through its app to increase ride safety, sending emails about speed and braking, for instance, to its drivers
  • Toyota and Grab will be able to use the data for possible collaboration on data-driven services such as vehicle diagnostics and customized insurance plans based on driver usage

TOKYO/SINGAPORE: By pumping $1 billion into ride-hailing firm Grab, Toyota Motor stands to gain a passenger-side view of tens of thousands of cars across Southeast Asia, tracking how fast they drive, how far they travel and the time they spend stuck in traffic.
The Japanese automaker said it aims to install its TransLog driving recorder devices into Grab’s fleet of lease cars to access the data on driving patterns that will be crucial to its push into the nascent mobility-as-a-service industry.
“Only ride-hailing companies have good, extensive data on usage, so automakers want to be connected with that,” said Egil Juliussen, director of research for automotive infotainment and advanced driver assistance systems at IHS Markit.
Grab already monitors driving behavior through its app to increase ride safety, sending emails about speed and braking, for instance, to its drivers, such as Singapore’s Rennu MaHajjan.
“With this system, it keeps me in check,” said MaHajjan, 57.
It will get even more vehicle data with Toyota, which has been harvesting data through TransLog since 2016 in sales and trials with taxi firms and car-hailing operators including Grab. The data gives Toyota insight into fleet management as it develops services including futuristic concepts such as pay-per-use mobile restaurants.
The latest deal, announced last week, gives Toyota access to a single pool of vehicles which potentially eclipses all others. That will allow it to capture a volume of data that would be difficult to collect from private cars which are only used for under 5 percent of any given day, often on routine commutes.
In return, Grab will be able to expand services such as food delivery and digital payments using Toyota’s $1 billion investment — the biggest by a traditional automaker in a ride-sharing app maker.
The deal reflects how automakers are clamoring for access to ride-hailing firms’ extensive user bases through a spate of partnerships, as they compete with technology companies to develop autonomous cars and next-generation transport services.
Toyota’s vision of such services includes convoys of shuttle bus-sized, self-driving multi-purpose vehicles used, for instance, as pay-per-use mobile restaurants and hotels, which the automaker plans to develop and customize for retail customers.
“There’s data about the car, and then there’s also data about the service — how many customers drivers have, what’s the average mileage, where the rides are concentrated,” said Juliussen. “Having that picture in all the major (Southeast Asian) cities, that becomes very valuable.”
Toyota and Grab will be able to use the data for possible collaboration on data-driven services such as vehicle diagnostics and customized insurance plans based on driver usage.
The data will also help Grab maintain efficiency in fleet maintenance as it expands deeper into Southeast Asia where it operates in over 200 cities. It has said it wants build the region’s largest car rental fleet by the fourth quarter of 2018.
“Vehicle maintenance costs, insurance costs, these are bread-and-butter issues for ride-hailing drivers,” said Chua Kee Lock, chief executive of Vertex Venture Holdings in Singapore, an early Grab investor.
Industry experts said Toyota could expand its data service to more mobility firms such as Didi Chuxing, Uber Technologies Inc. and Amazon.com Inc, with which it has separate partnerships.
“This partnership with Toyota will keep Grab’s platform ‘sticky’ and give drivers less incentive to switch to competitors,” said Chua. “This is Grab’s edge over the long-run.”


Apple Watch, FitBit could feel cost of US tariffs

Updated 20 July 2018
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Apple Watch, FitBit could feel cost of US tariffs

SAN FRANCISCO: The latest round of US tariffs on $200 billion of Chinese goods could hit the Apple Watch, health trackers, streaming music speakers and other accessories assembled in China, government rulings on tariffs show.
The rulings name Apple Inc’s watch, several Fitbit Inc. activity trackers and connected speakers from Sonos Inc. While consumer technology’s biggest sellers such as mobile phones and laptops so far have faced little danger of import duties, the rulings show that gadget makers are unlikely to be spared altogether and may have to consider price hikes on products that millions of consumers use every day.
The devices have all been determined by US Customs and Border Patrol officials to fall under an obscure subheading of data transmission machines in the sprawling list of US tariff codes. And that particular subheading is included in the more than 6,000 such codes in President Donald Trump’s most recent round of proposed tariffs released earlier this month.
That $200 billion list of tariffs is in a public comment period. But if the list goes into effect this fall, the products from Apple, Fitbit and Sonos could face a 10 percent tariff.
The specific products listed in customs rulings are the original Apple Watch; Fitbit’s Charge, Charge HR and Surge models; and Sonos’s Play:3, Play:5 and SUB speakers.
All three companies declined to comment on the proposed tariff list. But in its filing earlier this month to become a publicly traded company, Sonos said that “the imposition of tariffs and other trade barriers, as well as retaliatory trade measures, could require us to raise the prices of our products and harm our sales.”
The New York Times has reported that Trump told Apple CEO Tim Cook during a meeting in May that the US government would not levy tariffs on iPhones assembled in China, citing a person familiar with the meeting.
“The way the president has been using his trade authority, you have direct examples of him using his authority to target specific products and companies,” said Sage Chandler, vice president for international trade policy at the Consumer Technology Association.
The toll from tariffs on the gadget world’s smaller product lines could be significant. Sonos and Fitbit do not break out individual product sales, but collectively they had $2.6 billion in revenue last year. Bernstein analyst Toni Sacconaghi estimates that the Apple Watch alone will bring in $9.9 billion in sales this year, though that estimate includes sales outside the United States that the tariff would not touch.
It is possible that the products from Apple, Fitbit and Sonos no longer fall under tariff codes in the $200 billion list, trade experts said. The codes applied to specific products are only public knowledge because their makers asked regulators to rule on their proper classification. And some of the products have been replaced by newer models that could be classified differently.
But if companies have products whose tariff codes are on the list, they have three options, experts said: Advocate to get the code dropped from the list during the public comment period, apply for an exclusion once tariffs go into effect, or try to have their products classified under a different code not on the list.
The last option could prove difficult due to the thousands of codes covered, said one former US trade official.