FILE PHOTO: A Toyota logo is displayed at the 89th Geneva International Motor Show in Geneva, Switzerland March 5, 2019. REUTERS/Denis Balibouse/File Photo

TOKYO (Reuters) - Toyota Motor Corp and auto-parts maker Denso Corp on Wednesday said they have agreed to set up a joint venture to develop next-generation automotive semiconductors as the industry moves toward connected and autonomous vehicles.

Denso, a Toyota Group supplier, will own 51% of the new company, with Toyota holding the remainder, the companies said in a joint statement.

They said they aim to establish the company in April 2020 with a capitalization of 50 million yen ($458,968) and about 500 employees.

The venture will focus on components such as power modules for electric vehicles and periphery monitoring sensors for automated vehicles.

Computing power is rising in importance as cars increasingly become connected to each other, transportation infrastructure like traffic lights, and just about everything else.

Autonomous driving systems will also need the capacity to sense the world around them, interpret that data, and then make decisions such as whether to brake or veer to the right to avoid an obstacle, all within a fraction of a second.

Toyota and Denso agreed in June of last year to consolidate their electronic components production and development at the supplier in order to improve efficiency and accelerate innovation.

The two companies also banded together with another Toyota Group supplier, Aisin Seiki Co Ltd, to set up a development center for autonomous driving in Tokyo in March of last year, called Toyota Research Institute - Advanced Development, or TRI-AD.