Rival automakers Bayerische Motoren Werke AG and Daimler AG clinched a deal to merge their mobility services business units as both companies seek to expand their existing on-demand mobility offerings, including car sharing and ride-hailing, and electric car charging.

Under the deal, which is subject to regulatory scrutiny and approval, each company will hold a 50% stake in a joint venture comprising both companies' mobility services in five areas, including on-demand mobility, car-sharing services Car2Go and DriveNow, ride-hailing, parking and charging.

"Working as partners, both companies are thereby addressing the challenges arising from urban mobility and changing customer wishes, and cooperating with cities, municipalities and other interest groups to improve quality of life in major cities," the companies said in a release.

The companies will remain rivals in their respective core businesses, according to the release.