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Japan risks being left behind on self-driving cars

US trade shows provide valuable insights for Japan Inc.

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Waymo CEO John Krafcik unveils a Chrysler Pacifica Minivan equipped with a self-driving system at the North American International Auto Show in Detroit on Jan. 8.   © Reuters

TOKYO -- Automated driving-related technologies grabbed the spotlight at international consumer electronics and auto trade shows in the U.S. this month as the two industries rapidly converge on each other.

Delivering a keynote speech at this year's International Consumer Electronics Show in Las Vegas, Nissan Motor CEO Carlos Ghosn said that, although automated driving is an important challenge, "no automaker can do everything at once and alone."

Ghosn also announced strategic partnerships with Mobileye, an Israeli developer of driver-assistance systems, and Japanese internet company DeNA. Nissan was exhibiting at the annual trade show for the first time.

Meanwhile, Google unveiled a self-driving minivan developed jointly with Italian-American multinational Fiat Chrysler Automobiles at the North American International Auto Show in Detroit.

There had been rumors of the U.S. search giant pulling the plug on the development of autonomous cars. But the company decided to transition its driverless car division to a new company called "Waymo." Google said that it will soon begin testing the new minivan on public roads.

Gary Shapiro, president and CEO of the Consumer Technology Association, which sponsors the event, pointed out that automated driving is now a pressing challenge, regardless of industry, as 1 million lives are lost each year in traffic accidents around the world.

Many companies appeared to be competing to form technological alliances and find strategic partners at the two events.

Nvidia drew particularly strong attention. The major U.S. image-processing chipmaker formed tie-ups with German automakers Audi and Daimler. Nvidia has applied high-speed chips developed for gaming to image recognition in autonomous cars.

The company also announced alliances with other companies such as the Netherlands' TomTom, Germany's Here, China's Baidu and Zenrin of Japan in order to glean the digital mapping information needed for automated driving. 

Here is also intent on finding digital mapping partners. Three German luxury automakers -- Daimler, BMW and Audi -- jointly acquired Here from Finnish company Nokia in 2015. Later, U.S. chipmaker Intel and major Chinese internet company Tencent Holdings bought into the company and it began gathering road information.

Mobileye has also partnered with other companies such as BMW in a bid to secure pole position in automated driving technology.

Japan was slow to respond to the challenge of automated driving until the government, inspired by Google, set a target of getting self-driving cars up and running in time for the Tokyo 2020 Summer Olympics. The target was set under the government's Cross-ministerial Strategic Innovation Promotion Program.

Japanese automakers had been slow off the mark on self-driving cars. Their counterparts in the U.S. and Europe have made inroads into the segment, following in the footsteps of local IT companies and parts manufacturers.

The question now is how Japan Inc. can respond. In June 2016, a new private company called Dynamic Map Planning was established with the backing of the Japanese government to work out specifications for digital maps.

When it comes to "cooperation areas" like the creation of a mapping platform, Japan is poised to combine private- and public-sector strengths to better compete in the global race.

Meanwhile, Japanese parts manufacturers, unlike their U.S. and European counterparts, find it difficult to pursue alliance strategies. That is because of what is known as the "keiretsu" system, under which auto and other manufacturers maintain closely knit business networks with their respective groups of suppliers.

Japanese parts makers display their products and technologies at events like CES with due consideration to relations with their business partners. "I can see no driving force of technologies [among them]," said Sawako Yoshioka, a researcher at Tokyo-based InfoCom Research.

Japanese companies have long been pioneers of new products and technologies. But they have just as often gone on to lose market share to global rivals.

One good example is car navigation, which is related to automated driving and the brainchild of Japanese innovation. The country also got a head start in handheld terminals and contactless IC settlements.

If the country does not speed up the building of a computing platform for self-driving cars and secure more partners for their development, it risks being left behind again.

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