Better late than never
It’s about time for Toyota to pivot after squeezing by new regulations, the market & competition. Kudos to Toyota, having the courage to abandon backward-looking strategies while there is still time.
- Toyota just pivots from arguing the overhype of Electric Vehicles (EV) to fully embracing to ship 3.5M EV annually by 2030. Which is about 40% of Toyota’s 9M annual car production, just hitting the US’ target: 40–50% EV by 2030.
- Toyota is also developing its own car OS: Arene to handle everything from basic functions to self-driving according to Nikkei’s report on Jan. 4. Arene will power Toyota cars by 2025, and then be available to Subaru & other affiliates. With Arene, Toyota aims to compete with Tesla & VW on the smarter car section.
A late boomer?
No doubt, Toyota has been a strong “value carmaker” brand. It even overtakes GM as the top US carmaker in 2021, breaking GM’s 90 years “tradition”. Also, Toyota is very strong on sustaining innovations. Nevertheless, two questions are still open for the reality check.
- With about 10 years after Tesla & 3 years after VW, how may Toyota catch up? Car HW is less a concern for sure. However, SW may be a huge weak spot for Toyota.
- If the name of the game is smarter-car instead of “feature-car”, how may a 90M active car market (assuming 9M new car added for 10 years) sustain & attract new SW innovation? Partnership with other carmakers is a great strategy, but adoption is very hard to earn in the reality. One “good” thing is being late maybe to avoid trial & error that others already did. Maybe there are some useful lessons learned from VW’s Car.Software effort.
If you can’t beat them…
“PalmSource was over. Handset manufacturers didn’t want to touch someone else’s platform, because they didn’t want to be an enabler…” — Dianne Hackborn in Androids: The Team That Build the Android Operating System
For the majority of “headwear-defined” cars, Toyota as a top carmaker has all the power to control its own destiny for sure. BTW, Nokia also had its glory in the feature phone era. But as users expect more renewable innovation, it’s very difficult for Toyota to transform to more SW first, and also to do well on both vertically & horizontally integrated. As a 2022 wish, I’m hoping Toyota to pick a better strategy to save time & effort. Because the investment could be used to create new value benefiting to themself, their users & even the industry 🙏.
Full Disclosure
The opinions stated here are my own, not those of my company. They are mostly extrapolations from public information. I don’t have insider knowledge of those companies, nor a whatever expert.
