TOKYO — Toyota Motor Corp. President Akio Toyoda will create a trio of companies tasked with developing software for the next generation of smart cars. In detailing the plans, Toyoda said old business strategies no longer guarantee success in an industry being rocked by technological upheaval. Toyoda spoke here last week. These are edited excerpts.
Q: Why do automakers need to shift to making software?
A: In the old world, we are the hardware manufacturer, and all we need to do is buy software from someone else. But we must make continuous improvement and upgrading. But once you leave that to somebody else, you are allowing other people to achieve that upgrading. If we decide to develop and produce our own engines and our own software, we can use that for product improvement and create value. For that purpose, we need to pursue software first.
Why did you invest your own money to create Woven Planet?
Whenever new businesses or industries were born, it was the capitalists or entrepreneurs who had the strong will to make it happen. But nowadays in Japan, there are few true individual capitalists, personal investors. As president of Toyota Motor, and also as one individual investor, I wanted to demonstrate my commitment and will.
How has the COVID-19 pandemic affected your plans?
Today, even in a COVID-19 world, in some areas we are pressing hard on the accelerator pedal. This is not my decision alone. It is supported by others and made in consultation with their opinions. And that allows me to say I'm optimistic.
What will be the relationship between Toyota Motor and Woven Planet?
Both are like mirror images of each other. They will pick and choose from each other. Toyota Motor can provide the opportunity for Woven City to do it on its own financial means. It's a partnership, and at least it can sow the seeds for future change.
How do the Woven companies play into your plans to eventually hand off to a successor?
When I became president, the only thing I could devote my time to was dealing with the consequences of the past. I spent 200 percent of my time and energy on that. I felt that situation should be avoided when I pass the baton.
So if I were to receive the baton from my predecessor, this is the way I'd like to receive it. That's what I'm doing right now, for the future.