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NTT Data Teaming Up With Toyota for Overseas Connected-Cars Push

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(Bloomberg) -- Nippon Telegraph & Telephone Corp.’s data subsidiary is joining forces with Toyota Motor Corp. to develop connected cars that can collect and share data.

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NTT Data Corp. will actively consider mergers and acquisitions to accelerate a push into overseas markets, Yo Honma, the networking and data subsidiary’s chief executive officer, said in an interview. Honma sees the company spending as much as 400 billion yen ($3 billion) for deals over the next four years.

Toyota and other Japanese carmakers have been ramping up efforts to develop electric vehicles and connected cars, which can communicate with each other and outside networks to improve autonomous driving, performance and in-car features. New connected-car sales are on track to reach 94.8 million units globally in 2035, almost tripling from 2020, according to researcher Fuji Keizai Group.

“We’ll be planning a global roll-out after discussing with Toyota, once we have a product that is good enough to draw global attention,” Honma, 66, said. NTT Data will consider raising money from capital markets as needed, he added. The company hasn’t issued new shares since 1998.

Telecoms giant NTT currently owns about 54% of NTT Data, according to data compiled by Bloomberg. Last month, NTT unveiled plans to transfer its overseas business unit to NTT Data. The move effectively brings all of the telecommunication group’s overseas activities under one umbrella.

Woven Planet Holdings, Toyota’s advanced technology firm, has been on an acquisition spree since it was established last year to bolster its ranks of software engineers. The next-generation research unit said in September it will acquire Silicon Valley startup Renovo as a means to speed up its launch of a software platform for cars.

The latest move builds on a partnership between NTT and Toyota after they first formed a consortium five years ago to develop a connected-car ecosystem. NTT Data’s strength is in collecting data in a secure way and analyzing using artificial intelligence, Honma said.

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