BMW and Daimler invest €1bn in new car venture

Mercedes-Benz star in front of automobile Image copyright Getty Images

BMW and Daimler have unveiled a joint venture to invest in new-generation services such as driverless vehicles, ride-hailing and parking services.

The German firms are investing €1bn (£880m) in the project, which will also look into pay-per-use car schemes.

The move comes as traditional manufacturers face competition from mobility services provided by Uber and other technology firms.

BMW and Daimler said they were open to buying tech start-ups.

Established ride-hailing firms have been expanding. China’s Didi Chuxing aims to expand its business in Latin America and Uber is growing rapidly in the US market.

“Further co-operation with other providers, including stakes in start-ups and established players, are also a possible option,” Daimler’s chief executive Dieter Zetsche said.

Both companies have been working to develop autonomous car technology. Many analysts have argued that to survive against the tech giants, traditional car manufacturers must develop services based on usage rather than sales.

Daimler’s Car2Go car-sharing brand will be combined with BMW’s DriveNow, ParkNow and ChargeNow businesses, with both carmakers holding a 50% stake in the venture.

The new joint venture has five strands:

  • Reach Now: a smartphone-based route management and booking service
  • Charge Now: expanding electric car charging
  • Free Now: for taxi ride-hailing
  • Park Now: dedicated to offering parking services
  • Share Now: for car-sharing.

Harald Krüger, chairman of BMW’s management board, said: “These five services will merge ever more closely to form a single mobility service portfolio with an all-electric, self-driving fleet of vehicles that charge and park autonomously,”

The venture would be “a key cornerstone in our strategy as a mobility provider,” he said, adding: “The co-operation is the perfect way for us to maximize our chances in a growing market, while sharing the investments.”

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