Toyota Announces New Self-Driving Auto Software, Challenging VW And Daimler

Topline

Toyota plans to launch an operating system by 2025 that will handle autonomous driving, Japanese financial newspaper Nikkei reported Monday, an announcement coming on the eve of the release of sales figures expected to put Toyota at the top of the U.S. market for the first time.

Key Facts

Toyota’s Arene operating system would monitor safety systems and traffic information, as well as controlling basic car components like the steering wheel and breaks, reported Nikkei.

Toyota is considering making the system available to other auto manufacturers and startups working on electric or self-driving vehicles, Nikkei reported.

Arene is positioned to compete with Volkswagen’s upcoming “VW.OS” operating system and with Daimler’s “Mercedes-Benz Operating System,” planned for launch in 2024, Reuters reported.

The news came one day before the release of year-end sales figures for Toyota and General Motors which will likely put Toyota at the top of the U.S. market for the first time ever, ending GM’s 95-year reign, said CNN Business writer Chris Isidore.

Toyota’s sales significantly outstripped GM’s during the first three quarters of 2021, as GM reported facing “historically low inventories” of some vital parts.

Key Background

Software has become an increasingly critical part of auto design, managing electric motor and battery performance as well as more sophisticated functions like navigation and entertainment. Previously, auto manufacturers licensed much of their software from companies like Microsoft, Google and Blackberry. However, with the proliferation of electric and self-driving vehicles, more manufacturers have begun developing in-house operating systems. Tech companies have also branched into auto manufacturing, with an Apple Car expected on the market by 2025, according to a report by investment firm Wedbush Securities.

Contra

2021 was a rocky year for Toyota, and the company is forecast to report a 31% drop in sales for the fourth quarter, a period when auto and electronics manufacturers wrestled with semiconductor supply chain disruptions. However, GM is expected to report a 46% drop for the same period, preserving Toyota’s lead, Cox Automotive analysts told CNN.

Tangent

All vehicles using Arene, regardless of make or model, will have access to shared functions. Drivers will be able to update software online, allowing for “quick improvements” to vehicle performance, Nikkei reported.

Further Reading

“Toyota to launch its own automotive software platform by 2025 – Nikkei” (Reuters)

“GM was America’s largest automaker for nearly a century. It’s about to be dethroned by Toyota” (CNN)