Akio Toyoda on a mission to make Toyota a mobility company

The automobile sector is rapidly evolving from a conventional hardware-focused product to electric cars, hybrid cars, ride-hailing vehicles with strong software and tracking device, self-driving vehicles, hydrogen cars and lunar vehicles.

Akio Toyoda, chief executive officer and grandson of the company’s founder, aims to diversify the company in all the above mentioned segments as the demand for the conventional vehicle drops.

The Accenture forecasts that the industry sales are unlikely to go up in coming years besides a slight rise in 2030, while it adds that the mobility services are expanding, becoming a $1.34 trillion segment.

The world’s second largest automaker wants to up its game not only in terms of a fine hardware but also a strong software, and has invested about 1.05 trillion yen ($9.7 billion) a year on research and development. Toyota is working towards providing better software’s for data collection to enable its vehicles in improving safety, monitoring road conditions and providing a comfortable experience to its passengers.

To seize the ride-hailing market the automaker has invested into three of biggest companies in the segment ranging from Uber, China’s Didi Chuxing to Southeast Asia’s Grab Holdings Inc. Besides, the Japanese company has also teamed up with SoftBank to invest in self-driving venture called Monet Technologies Inc. In total five Japanese automakers including Suzuki, Mazda, Subaru Corp, Isuzu Motors Ltd and Toyota’s compact car unit Daihatsu has come together to invest in Monet with each pouring in 57.1 million yen (US$530,620) in the venture, in exchange of a 2% stake in the company.

Toyoda has been very vocal about his aim of transforming Toyota into a mobility service provider from a mere manufacturer.

He said, “My true mission is to completely redesign Toyota into a mobility company,” Toyoda said in May, saying the mission is to not just make products that move people around but provide “all kinds of services related to mobility.”

But its efforts doesn’t stop there. Sky is the limit for it as the company also aspires to be the first automaker on the moon. In collaboration with the Japan Aerospace Exploration Agency, Toyota is planning on creating one self-driving transporter. The six-wheeled vehicle with a capacity of two persons would be used to cover a distance of 10,000 kilometers. The company aims to launch its lunar vehicle sometime in 2029.

Koji Endo, senior analyst at SBI Securities Co. told Bloomberg, “Toyoda is determined to shift his company into a mobility company from a conventional hardware-oriented corporation. It’s yet to be seen if Toyota can win among the competition and rapid changes in the business model, but it seems management is determined to chase this course.”

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