TOKYO -- Toyota Motor Corp. and Japanese tech conglomerate Softbank Corp. will jointly fund a new mobility company that combines autonomous driving and ride-hailing with on-demand retail shopping delivered to people’s doorsteps by vehicles such as Toyota’s futuristic e-Palette.
The new company, to be called Monet Technologies Corp., will be 50.25 percent owned by Softbank and 49.75 percent held by Toyota, the companies announced at a Thursday joint news conference.
The partners will make an initial outlay of 2 billion yen ($17.54 million) and increase the investment to 10 billion yen ($87.72 million) over time, the companies said.
The first phase of operation will run through 2020 and deploy a ride-hailing service around Japan. The second phase, to kick in after 2020 when regulatory hurdles are cleared, will focus on deploying the e-Palette vehicle to do things like deliver food and medical care and take retail shopping to remote areas. Monet takes its name from the words “mobility network.”
The initial phase will focus on Japan, but the services are envisioned as eventually being extended overseas as well, a Toyota spokesman said. Monet will begin with about 30 employees from Toyota and Softbank and be headed Junichi Miyakawa, Softbank’s chief technology officer.
The agreement teams two of Japan’s biggest and most globally-minded companies as they each seek a bigger profile in the coming world of self-driving cars and new mobility.
“Softbank alone and an automaker alone can’t do everything alone,” Miyakawa said. “It is better to work together. We believe we can catch up with the more advanced players abroad.”
Toyota is bracing for a world in which people buy fewer personal cars, and the company is looking to new mobility and automated fleets for fresh revenue streams. Softbank, with its deep roots in telecommunications and microchips, sees autonomous driving as a next natural step.
“Everything starts with the microprocessor,” SoftBank founder Masayoshi Son said. “This is an extension of the semiconductor revolution. Our paths are crossing, finally.”
‘Friends and allies’
Son, the richest man in Japan, shared the stage with Toyota President Akio Toyoda to announce the deal in a rare joint appearance by two of Japan’s top captains of industry.
The move comes amid growing concerns in Japan that its automakers are falling behind in the global self-driving car race, as rivals pile in from new corners such as China and Silicon Valley.
A day before the Toyota-Softbank tie up, Japanese rival Honda Motor Co. said it would invest $750 million in General Motors’ autonomous vehicle business, GM Cruise LLC. Under that deal, Honda will also pay $2 billion for development and deployment of self-driving cars.
Monet will leverage Toyota’s e-Palette, which was unveiled at the 2017 Consumer Electronics Show in Las Vegas. It is a fully autonomous, pure electric boxcar-like rolling work and living space on eight wheels. Toyota develops the undercarriage and platform and lets others customize the shell. Think mobile field office, rolling pizza parlor or on-the-go shoe store.
Toyota Executive Vice President Shigeki Tomoyama said Toyota wants to commercialize the e-Palette around 2023. Monet will not be a developer of autonomous driving cars, he said. The new joint venture will be a mobility as a service provider that leverages that technology.
With their costly network of semiconductors and sensors, Son said the initial customers of such autonomous vehicles will be commercial fleets, not individuals.
“Normal retail customers are not our first target,” he said.
Toyota and Softbank already have a shared focus in new mobility. Both are major investors in Uber Technologies, the leading ride-hailing service.
Toyota said in August it would invest $500 million in Uber. And earlier in the year, Softbank took stake in Uber making it the U.S. company’s biggest shareholder at the time.
Toyota and Softbank also own big stakes in Grab, the Southeast Asian ride-hailing company.
Japan’s biggest automaker must better leverage the data derived through its millions of cars to cultivate new business models, President Toyoda said.
“We must find new ways of creating mobility services, day in and day out, through data collection,” Toyoda said. “Friends and allies will become increasingly important.”
For his part, Son has stepped up investments across the autonomous field over the past year as the entrepreneur and self-made billionaire looks to tap growth sectors.
In May, Softbank also shelled out $2.25 billion to take a 20 percent stake in GM's autonomous vehicle business, GM Cruise Automation.
The Japanese tech company also partnered with Chinese ride-hailing giant Did Chuxing to start trial service of a taxi-based ride-hailing system in Japan, where laws limit freelance drivers.
Moreover, through its SoftBank Vision Fund, SoftBank has made a string of investments into the automotive and self-driving car field. It has invested in chipmaker Nvidia, a key supplier of autonomous technology, the European used-car startup Auto1, and in Mapbox, a mapping platform for website and mobile app developers.
The $100 billion fund is the long-term incubator arm of SoftBank Group Corp., a global holding company with tentacles in everything from telecommunications to microprocessors.
The fund's mission: Cherry pick top contenders in the high-tech world that will "enable the next age of innovation." In addition to transportation, its target sectors include such futuristic endeavors as artificial intelligence, robotics, big data businesses and financial technology.
Son’s SoftBank Mobile is one of Japan's top cellular services. Its overseas holdings include majority ownership of U.S. mobile phone operator Sprint Corp.
The group also operates the Yahoo! Japan web portal and owns ARM Ltd., the microchip designer and Internet software company. Softbank has been spurring ARM to invest more heavily in chips for automotive use. Last month, ARM unveiled a new line of autonomous vehicle processors that provide extra cybersecurity again hacking.
He forecast that, with the maturation of autonomous driving, about 40 percent of the world’s microprocessor output will be channeled into the automotive industry.
“We believe,” Son said, “these chips will be mounted on cars one after the other.”
Naoto Okamura contributed to this report