German manufacturing giants BMW Group and Daimler have agreed to merge their mobility service business units, subject to approval from the responsible competition authorities.

BMW and Daimler will both own 50% of the newly-created joint-venture.

According to a release, the joint venture model has been designed to combine BMW and Daimler services in car-sharing, ride-hailing, parking, charging and multi-modality.

Until now, the two had been competing on mobility related fronts. Their relatively high profile carsharing platforms Car2Go and DriveNow were potential competition to one another – now these business will operate under one roof. The two businesses operate a total of 20,000 vehicles in 31 cities, and the companies said they have over 4m customers.

It will also see Daimler and BMW’s various ride hailing apps, including mytaxi, Chauffeur Privé, Clever Taxi and Beat all brought together.  It will also see their parking brands (PArkNow and Parkmobile), charging brands (ChargeNow and Digital Charging Solutions) and on-demand mobility services (moovel and ReachNow) all brought together.

Harald Krüger, chairman of the board of management of BMW, said: “Combining our mobility services as planned will create a unique digital ecosystem. This alliance will make it easier for our customers to discover the emission-free mobility of the future. We remain competitors when it comes to the best premium vehicles. The planned merger of our mobility services will pool our resources and sends a strong signal to our new competitors.”

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Dieter Zetsche, chairman of the board of management of Daimler and head of Mercedes-Benz Cars, added: “As pioneers in automotive engineering, we will not leave the task of shaping future urban mobility to others. There will be more people than ever before without a car who will still want to be extremely mobile. We want to combine our expertise and experience to develop a unique, sustainable ecosystem for urban mobility,

“At Daimler, we are vigorously and systematically pursuing our transformation from automobile manufacturer to provider of mobility services with our CASE strategy.

The companies said, if approved by the relevant authorities this year, the move would see a significant positive valuation and earnings effect at Daimler Financial Services, resulting in a slightly higher EBIT for the Group as a whole.

Similarly for BMW, the Group wrote: “The formation of the joint venture will trigger a one-time valuation and earnings effect in the BMW AG’s group financial statement and thus lead to an adjustment of the company’s guidance: Under these circumstances, pre-tax earnings on Group level would increase slightly in 2018 compared with the previous year. The valuation and earnings effect would have no impact on the EBIT margin in the automotive segment.

The two companies will remain competitors in the respective core businesses.