The rival German carmakers announced the investment describing their mobility business as a “global game changer” that could help fend off challenges from upstarts including Uber.
The venture is one example of how established automakers are forming partnerships to share the costs of developing technologies including autonomous driving systems and electric vehicle platforms.
The companies first announced their intention to join forces in March 2018, but the plan required regulator approval.
BMW () and Daimler are focusing on five areas: car-sharing, ride-hailing, parking, charging and multimodal transport, which allows travelers use multiple transportation methods on a single trip.
“These five services will merge ever more closely to form a single mobility service portfolio,” said BMW chief Harald Krüger. “The cooperation is the perfect way for us to maximize our chances in a growing market, while sharing the investments.”
DriveNow is a carsharing service owned by BMW.Other global automakers have also paired off.
Ford () and Volkswagen ( )announced a plan in January to build vehicles together. The companies also agreed to investigate how they can work together to develop next generation vehicles.
The trend toward cooperation has accelerated as carmakers more under increased pressure from tech companies including Uber and Google () parent Alphabet.
Upstarts like Tesla () and new combinations, such as the joint effort by General Motors ( ), SoftBank( ) and Honda ( ), could also shake up the industry’s future.