Rivals BMW and Daimler team up for $1B venture

Look to launch joint services

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Harald Krüger (L), CEO of BMW AG, and Dieter Zetsche, CEO of Daimler AG, shake hands after speaking to the media about a new joint effort between the two automakers in carsharing on Feb. 22, 2019, in Berlin.

(CNN) - BMW and Daimler are putting more than $1 billion into a joint venture that will develop ride-sharing, charging and parking services.

The rival German carmakers announced the investment on Friday in Berlin, describing their mobility business as a "global game changer" that could help fend off challenges from upstarts including Uber.

"Our mobility services have developed a strong customer base and we are now taking the next strategic step," Daimler boss Dieter Zetsche said in a statement.

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.

"Further cooperation with other providers, including stakes in startups and established players, are also a possible option," said Zetsche, who also oversees Daimler's Mercedes-Benz brand.

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."

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.

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