So-called connected cars are equipped with cameras, lasers and electrical control units that turn the vehicles into moving sensors.

A whole range of data can be collected, from driving distances and speeds all the way to the entertainment content played by the vehicle occupants.

“For the automotive industry competing in the electrification of vehicles, converting operating data into a revenue stream is the top priority,” said Tomoki Hamano, principal business consultant at Nomura Research Institute.

Honda, which holds driving data on about 3.7 million vehicles, has begun to provide that data to commercial facilities and other clients.

Honda first established the business of utilising the data in 2017.

But the automaker had only transferred that data on a limited basis, such as to local government authorities looking to pinpoint drivable roads during disasters.

This time, Honda will put more resources into developing clients.

In August, the automaker started providing information on driving conditions using electric boards.

The price for that offering is about ¥4 million a month.

Honda has partnered with Tokyo location data start-up Nightley to analyse drivers’ behaviour for a fee.

The data is expected to be used in determining consumer demands, gauging the effectiveness of advertising and for planning openings of retail outlets.

Monthly subscriptions start at ¥200,000.

Toyota Motor has teamed with the NTT group to develop technology that controls the flow of traffic in an area after detecting congestion.

Nearly all new Toyota passenger vehicles sold in Japan and the US since last year are connected.

Now Toyota is constructing an infrastructure to utilise the data.

Toyota looks to monetise the data through collaborators, such as Uber Technologies.

The leading automaker has already worked with Japan’s Aioi Nissay Dowa Insurance to analyse driving data and offer discounts on auto insurance.

About 80% of all autos sold globally in 2035 will be connected vehicles, according to Tokyo-based market intelligence firm Fuji Keizai, amounting to 94.2 million vehicles a year.

Driving data will deliver annual incremental value of US$400 billion in 2030, the figure including additional revenue from services, sales of data and cost reduction, according to a report by New York business consultancy McKinsey & Co.

On the other hand, “if you aren’t able to identify which data is valuable, the costs of managing that data will exceed its benefit”, said Yu Chiba of NTT Data.

The data related to vehicle control produced by 5 million connected cars in a single month amounts to 104 petabytes, according to NTT Data.

That is enough to fill over 4 million 25-gigabyte Blu-ray Discs.

Adding camera footage and other data multiplies the volume more than 100 times over.

Wejo, a British start-up backed by General Motors, operates a trading platform for the voluminous connected car data.

The company collects real-time data from auto companies, then processes and provides the information in ready-to-use formats.

An Israeli rival, Otonomo, runs a similar platform where BMW, Daimler and 14 other automakers have joined as sellers.

There are over 100 data buyers, including those from insurance, payment, and advertising industries, as well as local governments.

Otonomo takes a 35% cut of the sales while the auto companies collect the rest.

BMW joined the Otonomo platform to pave the way for commercial use of driving data.

Its information is sold to insurance companies, app developers, and others, and used in services that can inform drivers about open parking spaces nearby and warn of icy road conditions, for example.

Japanese companies are taking an interest in data exchanges as well.

Sompo Holdings is joining hands with Microsoft for a US$25 million investment in Wejo that will give the insurer a single-digit stake.

It plans to leverage the partnership to develop new business areas and insurance products.

Mitsubishi Motors plans to begin selling data via Otonomo as well.

Otonomo went public in August via a merger with a special-purpose acquisition company, or SPAC, bringing in about US$260 million that will be put toward system development and expanding its customer base.