Toyota’s $10 Billion Gamble: How NVIDIA Chips Will Power the Future of Self-Driving Cars

Toyota Motor Corporation bolsters its collaboration with NVIDIA, the U.S. semiconductor giant, marking a transformative step in the automotive industry’s approach to technology integration.

According to Nikkei on Friday, Toyota, the world’s largest automaker, plans to incorporate NVIDIA’s advanced semiconductors into its next-generation vehicles.

This strategic decision comes as semiconductors gain increasing importance, fueled by rapid advancements in artificial intelligence (AI) and autonomous driving technologies.

Although Toyota has partnered with NVIDIA since 2017, this latest move signals a more determined effort to leverage NVIDIA’s technological expertise.

Jensen Huang, NVIDIA’s CEO, expressed his enthusiasm about the partnership during a press conference on January 6, just ahead of CES, the world’s largest tech showcase, in Las Vegas.

The automotive semiconductors Toyota plans to adopt are equipped with NVIDIA’s proprietary GPUs (graphics processing units) and deliver processing capabilities exceeding 200 trillion operations per second—a remarkable sevenfold improvement over previous models.

Toyota first utilized NVIDIA’s semiconductors in 2021 by releasing a self-driving vehicle capable of hands-free operation.

This renewed collaboration highlights the growing role of AI in advancing autonomous driving, reshaping competition within the automotive industry.

Meanwhile, Tesla, the U.S.-based leader in electric vehicles, has announced plans to invest $10 billion in AI development by 2024.

As the demand for AI technology rises, automakers increasingly turn to NVIDIA, which holds an 80% share of the AI GPU market.

Toyota is also advancing its in-house semiconductor capabilities.

Through a joint venture with its affiliate Denso, the company is developing semiconductors while expanding partnerships with external firms. It has also invested in Renesas Electronics and TSMC’s Kumamoto plant in Taiwan.