Toyota Motor Corp. is Uber, Inc.’s latest investor, with both companies coming to an agreement that along with an undisclosed investment will see Toyota provide leased vehicles to Uber drivers on favorable terms.

According to a statement from Toyota, the memorandum of understanding (MOU) includes a commitment to explore “collaboration” that will start with trials “in the world of ridesharing in countries where ridesharing is expanding, taking various factors into account such as regulations, business conditions, and customer needs.”

In addition, Toyota states that “through this agreement on the trials, Toyota and Uber will accelerate further talks in aiming to establish new services and to offer new value to customers,” including “developing in-car apps that support Uber drivers, sharing knowledge and accelerating their respective research efforts.”

If none of that makes sense, Bloomberg claims that it translates into Toyota wanting to build expertise about how consumers use ride-sharing services.

The deal follows General Motors Corp.’s $500 million investment in Uber rival Lyft, Inc., and may also be a move by Toyota to not only have a stake in the ever-growing ridesharing market, but also to sell more vehicles.

“The automakers see a threat and an opportunity,” independent auto analyst Alan Baum told Bloomberg. “If all they’re doing is selling vehicles and don’t see the customer again for years, then that’s a problem. If they can find a way to generate ongoing income, then that’s what they want to do.”

Alliances

The general theory, be it one pushed in part by Uber itself, is that over time ridesharing services will replace the need for individual car ownership, and while millions are yet to forgo their personal vehicles, in some areas it is already happening.

Individual car ownership, along with owning a home, has long been a part of not only the American dream, but that of many Western countries, and the idea that car ownership may one day be redundant runs against nearly a century of thinking.

That said, the shift naturally represents a challenge to automotive manufacturers, and rather than ignore it, they are better placed to be part of that change than outside of it. That seems to be not only General Motors reason for investing in Lyft, but Toyota going into Uber as well; cars will always exist in some form or another, but if in 20 years time most people don’t own one, supplying vehicles to an Uber, Lyft or yet launched similar service may well be the main game in town.

Image credit: Toyota