A Toyota Motor subsidiary working to build a smart “Woven City” near Mount Fuji held JPY 6 billion (USD 41.5 million) more in liabilities than assets as of the end of March, according to earnings documents disclosed by Friday.
Toyota and Tokyo-based unit Woven Planet Holdings broke ground on the project in Shizuoka prefecture in February 2021. The city will serve as a testing ground for autonomous vehicles, advanced logistics chains and other cutting-edge technology, with initial trials slated to start in 2025.
Toyota Chairman Akio Toyoda has personally invested JPY 5 billion (USD 34.5 million) in the venture. Around 2,000 individuals are expected to eventually live at the site.
Woven Planet booked JPY 101.5 billion (USD 701 million) in extraordinary losses for the year ended March.
Much of this stemmed from impairments and allowances for bad debt tied to Woven Alpha, a unit involved in developing Woven City as well as a vehicle software platform named Arene. Woven Alpha held JPY 89 billion (USD 614 million) more in liabilities than assets as of the end of March, according to Toyota’s securities report filed Friday, a result of mounting development costs.
Woven Planet was rebranded as Woven by Toyota on April 1 through a merger with Woven Alpha and Woven Core, a separate unit that developed self-driving technology. The company is not expected to face a cash crunch despite its negative worth, as long as it can receive financial support from its backers.
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Even as his pet project struggled, Toyoda, who was Toyota’s president until the end of March, received a total compensation package of JPY 999 million (USD 6.9 million) last fiscal year. The figure increased 46% from the prior year after the automaker adopted new compensation guidelines that partly track pay at European multinational companies and is the highest ever earned by a Toyota president.
This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.