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Business

Toyota to mine the connected car for new business lines

The Smart Key Box is among Toyota's innovations to make car-sharing services easier to use.

NAGOYA, Japan -- Toyota Motor is widening the scope of its business to establish new sources of revenue from products and services geared toward the connected car.

The Japanese automaker intends to incorporate internet connectivity as standard equipment in almost all of its cars, and to offer a range of products and services for Toyota drivers and business partners, including car- and ride-sharing services.

Toyota outlined the plan Tuesday at a meeting in Tokyo held to describe its connected-car strategy. Senior Managing Officer Shigeki Tomoyama, who heads Toyota's connected-car operations, said that while Toyota will maintain its identity as a company that makes and sells cars, it will also wear the hat of a service provider.

By 2020, virtually all the Toyota cars sold in Japan and the U.S will come with communications capabilities as standard equipment. This kind of connectivity is now mainly limited to the luxury Lexus brand, but moving forward cars sold under the Toyota moniker will also come internet-ready. That would place some 4 million more connected cars on the road yearly.

As a first step, Toyota plans to equip the Prius PHV plug-in hybrid coming out this winter with communications capabilities. Owners will have access to a service that lets them use their smartphones to check the status of battery charging and to remotely fire up heating and air conditioning. The service will be free for the first three years and 12,000 yen ($115) annually thereafter.

Toyota is also using the connected car as a launching pad for new businesses.

One example is its partnership with the U.S. company Getaround, which operates a car-sharing service. With car sharing, the keys to the car need to be passed from one user to the next. But Toyota has developed devices that can be fitted to cars so a smartphone can be used to both unlock the car and start the engine. Toyota's business model is to provide the devices and collect a usage fee.

The automaker has also partnered with U.S. ride-sharing giant Uber Technologies. Starting in December the two plan to test a business where people buy vehicles and pay back the loans by working as Uber drivers.

(Nikkei)

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