Toyota Motor Corp. launched a new Corolla in Japan this year that held a shock for its closely knit Japanese supplier network: a cutting-edge crash prevention system made by a German parts maker.
Until now, Toyota relied on Denso Corp., a major parts maker and key member of its traditional supplier network, but which provided such equipment only in high-end Toyotas. The Corolla’s technology, made by Continental AG, will spread to many of the vehicles Toyota sells in the U.S., Europe and Japan by the end of 2017.
The decision to go outside its traditional network highlights a growing concern within Japan’s auto industry: Parts suppliers, once considered the foundation of the country’s auto export prowess, are losing their edge, especially in next-generation software technologies for safety and autonomous driving.