The deal comes as the auto industry faces a spike in the need for technological prowess with the advent of features such as autonomous driving, while app makers offer passengers the option to forgo vehicle purchases by connecting them with drivers. In March this year, it acquired Uber's Southeast Asian assets to be the dominant ride-hailing player in the region. The carmaker first invested an undisclosed amount in Grab in August a year ago, after it invested in US-based Uber in 2016 in a partnership for a financing programme that allowed Uber drivers to lease vehicles from Toyota and drive for Uber to cover the payments.
Toyota already invested an undisclosed amount in Grab past year.
Currently, Grab counts carmakers Toyota, Honda and Hyundai among its investors, as well as Chinese ride-hailing giant Didi Chuxing. The investment is the largest ever of its kind by an carmaker into the ride-hailing industry, according to Grab.
The firm also offers online to offline services, such as food delivery and digital payments, which it aims to expand deeper into the region using funds from its latest financing round. The Malaysian-born but now Singapore-based company has its namesake app in over 100 million mobile devices, giving passengers access to over 6.6 million drivers and agents.
Toyota has installed its driving recorder devices in some vehicles operated by Grab, using the collected data stored in its mobility services platform to analyse driving patterns and develop vehicle services.
Grab will collaborate with Toyota on how connected auto services on the Toyota Mobility Service Platform (MSPF) - such as user-based insurance, financing program and predictive maintenance - could enrich the Grab experience for drivers on the Grab platform. This strong partnership will enable us to become the one-stop mobility platform in Southeast Asia.
In return for its capital, Toyota will also get a board seat and the opportunity to place an executive within Grab's team.
"Going forward, together with Grab, we will develop services that are more attractive, safe and secure for our customers in Southeast Asia", Toyota executive Shigeki Tomoyama said in a statement.
Earlier this year, Uber exchanged its Southeast Asian operations for 27.5% of Singapore-headquartered grab, ending a battle between the two for regional dominance.
Last month, Indonesian ride-hailing and online payment firm Go-Jek said it would enter Vietnam, Thailand, Singapore and the Philippines in the next few months, investing $500 million in its global push.
Grab is in eight nations in the region, including Malaysia, Singapore and Indonesia.