Kakao Mobility acquires Hyundai Capital's DelCar

Tech

Published: 18 Mar. 2021, 17:22 Updated: 18 Mar. 2021, 18:00

Kakao Mobility acquires Hyundai Capital's DelCar

Kakao Mobility has acquired DelCar, Hyundai Capital’s car-sharing app, for around 8 billion won ($7.1 million).

The two signed an agreement on Thursday.

“With the acquisition of DelCar, we’re considering adding a feature using rent-a-cars on the Kakao T app,” Kakao said in a statement. Kakao T is the IT firm’s transportation app that offers taxi-hailing, navigation and driver services.

The company made it clear that it will not directly engage in the car renting business.

Short for Delivery Car, DelCar is a car-sharing app partnered with 280-or-so rent-a-car companies. While other car-sharing services like SoCar own vehicles, the ones offered by DelCar are owned by rent-a-car company partners.

For customers, DelCar’s advantage is that it delivers and returns the rented cars, whenever and wherever they wanted. The user only has to input the time and location of the pick-up in the mobile app. It was introduced in 2017 by Hyundai Capital.

Kakao Mobility already engages in a range of mobility services, but car sharing or renting are realms in which it has not ventured. DelCar would fill that gap.

The company has been preparing to do business in the area for some time now. In April 2020, Kakao Mobility added “car renting” as a business purpose on its company registration.

Last month, it raised $200 million from Carlyle Group, saying the funds would be used on partnerships with firms or start-ups to enlarge Kakao T’s “Mobility as a Service (MaaS)” platform. It was the first external investment raised in more than three years.

MaaS can include any service related to transportation and vehicles, apart from ownership—from ride-hailing, offering real-time information for public transportation to sharing bicycles and scooters.

A score of IT firms are developing businesses in this segment. SK Telecom’s Tmap Mobility is slated to start a joint venture with Uber next month and is currently preparing to raise 300 to 400 billion won from a private equity firm, according to industry sources. VCNC, which operated the van-hailing service Tada, started a new service last month that send drivers within 15 minutes in the Seoul area.

BY SONG KYOUNG-SON, PARK MIN-JE [song.kyoungson@joongang.co.kr]