Toyota (TM.US) will invest over $44 million in the Japanese space startup Interstellar.

Japanese space startup Interstellar Technologies announced on Tuesday that Toyota Motor Corp. Sponsored ADR (TM.US) will be investing 7 billion yen (approximately $44.4 million) through its mobility technology subsidiary Woven by Toyota. Interstellar Technologies aims to mass-produce light rockets and eventually compete with large companies in the growing commercial space industry. Toyota stated that they hope to leverage their experience in mass-producing cars to collaborate with Interstellar Technologies in rocket production. In a statement, Interstellar Technologies mentioned that Japan conducted three rocket launches in 2023, but there is still room for improvement before reaching the goal of launching 30 times annually in the first half of this century. The company expressed that Japan will need a "structural transformation of the domestic aerospace industry" to fulfill this commitment. They aim to "transform rocket manufacturing into a high-quality, low-cost, and scalable process" by utilizing expertise from the automotive industry, including Toyota's production methods. Toyota Motor Corp. Sponsored ADR Chairman Akio Toyoda hinted at this investment during his speech at the 2025 Consumer Electronics Show (CES) in Las Vegas on Monday. Toyoda mentioned that Toyota's interest in rockets is part of the company's broader efforts in innovation in the transportation sector. He also stated that Toyota hopes to compete with SpaceX and believes that "future travel should not be limited to Earth or one car company." In November of last year, the Japanese government began announcing the recipients of its strategic fund, which will allocate 1 trillion yen to various startups, manufacturers, and research institutions over the next decade. While Japan is recognized for its satellites and precision instruments used to collect data in near-earth orbit, the country's geographical location is not ideal for establishing a large network of launch facilities. Toyota's investment in Interstellar Technologies is the latest indication of progress by the Japanese government in fostering domestic private aerospace companies. However, for fledgling startups, keeping pace with industry leaders in this fast-paced and competitive field remains a challenge.