Why is the Motor Industry Sharing Its Closely Guarded Patent Data Now?

On Wednesday 4th April 2019, Toyota made the exciting announcement that they were to release, free of charge, 24,000 patents that relate to their electric vehicle innovations. Why?

Posted April 17, 2019

At first glance, they are claiming the moral high ground as their statement declares an aim to;“further promote the widespread use of electric vehicles – to accomplish goals relating to global warming.”

And they are not alone.

This follows Tesla’s long-standing position of sharing all patents; “All our patents belong to you” was the bold and seemingly generous statement from Elon Musk announcing their change to open source. And Daimler have also adopted an open source strategy and are even providing a platform for collaboration.

In an industry that traditionally guards its patent data ferociously and treats all competitors with the utmost suspicion, what is going on? Why the sudden change? What is driving this new open source, caring and sharing strategy?

The PatSnap Motor Team take a closer look.

The Toyota patents being offered relate only to plug-in, hybrid electric vehicles.The Toyota Prius (13m sold) was first released in 1997, 22 years ago. Utility patents have a typical lifespan of 20 years. We speculate that many of these patents being released relate to existing, mature technologies and are therefore not so valuable.

Furthermore, this might be part of a cunning plan from Toyota. With the industry appearing to transition directly to full EV’s, Toyota, as a hybrid company, are not especially well positioned and by sharing hybrid patents, they might be able to encourage more adoption of hybrid vehicles to slow down the overall industry transition, giving them more time to refocus and catch up on the likes of Nissan.

In the case of Tesla, open source and royalty free does not mean without strings attached. When Tesla announced they would open all their patents up in 2014 it came with the caveat that in order to use their patents a company would have to open up and share their patents as well. This strategy of “I’ll show you mine if you show me yours” greatly reduces the value of those patents and at the same time, Tesla get the benefit of shared innovations by converting competitors to apparent collaborators.

And finally, Daimler’s open source sharing platform has been likened to Apple’s App Store. Daimler will not own the innovations but will benefit from access to the innovative ideas from disruptors and startups using the platform and will be able to control the flow of information, potentially a massive competitive edge.

The most valuable patents in automotive industry relate to Battery Electric Vehicles (BEVs) and autonomous driving. And no one is going open source with those. Yet.

In summary, the 24,000 patents released by Toyota represent around 10% of Toyota’s global patent portfolio, no small portion. However, the real gems are likely to still be protected.

These gems can be discovered using PatSnap’s leading Patent Search & IP Analytics Software. Search patents to identify opportunities, monitor competition and innovate faster.