Volkswagen invests 2.4 billion euros for autonomous driving in China

Home AI in Business Volkswagen invests 2.4 billion euros for autonomous driving in China

Volkswagen seeks to strengthen China. The car manufacturer announced on October 13, 2022, the creation of a joint venture between its subsidiary specializing in software Cariad and the Chinese start-up Horizon Robotics. A partnership that aims to help Volkswagen adapt its autonomous driving solutions for the Chinese market.

Cariad remains in charge since the subsidiary will hold 60% of this joint venture. Volkswagen will invest 2.4 billion euros in cooperation with Horizon Robotics. In detail: Volkswagen invested 1.3 billion euros in the joint venture and 1.1 billion euros in Horizon Robotics, specifies Reuters. The transaction is expected to be finalized in the first half of 2023.

Integrate the most features on a chip

Horizon Robotics develops chips dedicated to calculations related to artificial intelligence. They are designed to equip robotic systems or autonomous vehicles. The start-up announced that it had raised $150 million to accelerate the commercialization of its chips in December 2020. It boasts partners like Bosch, Audi, ContinentalSAIC Motors, BYD, and Faurecia.

With this partnership, Volkswagen wants to accelerate the development of its advanced systems for autonomous driving (ADAS) and its autonomous driving systems for the Chinese market. By approaching Horizon Robotics, the objective is to integrate a maximum of functionality on a single chip in order to increase the stability of the system and reduce costs and energy consumption.

“The partnership with Horizon Robotics is a cornerstone of our strategy to realign and further strengthen our business in our most important market in the world. […]comments Ralf Brandstätter, director of the Volkswagen Group in China. The advanced technology comprising software and hardware, which the new joint venture will develop, will enable us to adapt our products and services even faster and more consistently to the needs of our Chinese customers.”

Partnerships with Qualcomm and STMicroelectronics

Volkswagen has also established strategic partnerships in other regions of the world: with STMicroelectronics for Europe and Qualcomm for North America. The partnership with Horizon Robotics looks deep as Cariad will take an active role in the development of chip technology with Horizon Robotics.

A way for Volkswagen to improve its offer in this ultra-competitive market. The Chinese manufacturers all offer a fairly simple digital offer to understand and try to differentiate themselves in terms of driving assistance features. Above all, this announcement comes as the UNITED STATES has just strengthened its legislative arsenal aimed at limiting the marketing of chips in China. Ensuring the production of chips for this market within the country itself makes it possible to limit the possible effects of this regulation or other future restrictions.