Volkswagen Group will invest $2.4 billion in China autonomous driving venture

The transaction is expected to be completed in the first half of the year 2023

Volkswagen Group will invest $2.4 billion in China autonomous driving venture

Volkswagen Group will invest $2.4 billion in China autonomous driving venture

CARIAD will hold a majority stake of 60%

Volkswagen AG’s software entity CARIAD with China’s Horizon Robotics Inc, a leading supplier of energy-efficient computing solutions for smart vehicles intends to establish a joint venture in China with an investment of 2.4 billion euros and take a majority stake of 60%. The transaction is expected to be completed in the first half of the year 2023. This would assist in strengthening the company’s tech presence in the biggest market in the world.

The autonomous driving joint venture will develop automated and assisted driving systems for China and incorporate numerous functions on one chip to lower energy usage and minimize cost, allowing scalable AD and ADAS solutions with differentiating innovation. The technology will be built for Volkswagen’s battery-only models that are sold in China, where consumers largely pick local electronic vehicle brands and to hasten innovation in such markets. Volkswagen’s software unit in CARIAD plays an important role in developing the chip technology with Horizon Robotics.

Volkswagen Management Board Member, Ralf Brandstätter states that the joint venture with Horizon Robotics will allow the firm to speed up the development of automated driving as a part of the car manufacturing company’s NEW AUTO strategy and “drive the repositioning” of the firm’s business with China. He also states that localized technology developments provide the region more autonomy to expand the firm’s position in the active automotive market. The new venture will develop and enable the firm to tailor the products and services at a consistent and faster pace that will meet the needs of Chinese customers with the help of advanced technology, says Ralf Brandstätter.

Horizon Robotics is a leading provider of energy-efficient computing solutions for Advanced Driver Assistance Systems (ADAS) and autonomous driving for smart vehicles. Hillhouse Capital, Intel Corp., and BYD Co. which is an electric vehicle maker are investors in Horizon and have highly sophisticated technologies that can be used in almost everything. Horizon Robotics is dedicated to enriching the next generation of smart driving by combining hardware and software.

Dr. Kai Yu, founder, and CEO of Horizon Robotics states that the company is devoted to encouraging smart vehicles through integrated computing solutions with the goal to make life easier. He further stated that the company will bring its expertise to the partnership with CARIAD to develop next-generation advancements in technology for smart vehicle users.

CARIAD is an automotive software company within the Volkswagen Group that further expands the firm’s software competencies to create transformations in the automotive industry. CARIAD works on outstanding digital automotive features that include ADAS solutions, which is a standardized infotainment platform, and software functions for linking powertrains, and digital business models around the world.

CARIAD CEO Dirk Hilgenberg states that CARIAD is an important part of the company’s transformation into a software-driven mobility provider and the joint venture with horizon robotics, CARIAD is “underlying their position in innovation and modernization in China’s automotive industry”.  Dirk Hilgenberg adds that their goal is to create long-term value in China for Volkswagen group and the shareholders along with expected market development. The partnership is an important milestone of Volkswagen’s NEW AUTO strategy to move forward the company’s digitalization strategies to a software-driven mobility company.

About Volkswagen

The Volkswagen Group is headquartered in Wolfsburg and is one of the world’s leading automobile manufacturers and carmaker in Europe. The Group operates around 120 production plants in 20 European countries and a further eleven countries in Asia, America, and Africa. Each working day, approximately 630,000 employees worldwide produce around 40,000 vehicles and are involved in vehicle-related services.

Volkswagen Group is made up of twelve brands from seven European countries: Volkswagen, SEAT, Audi, Ducati, ŠKODA, MAN, Lamborghini, Porsche, Volkswagen Commercial Vehicles, Scania, and Bentley. The company promises to make the automobile clean, intelligent, quiet, and safe with electric drive, digital networking, and autonomous driving. Volkswagen’s core product becomes more emotional and offers a completely new driving experience. The company also focuses on becoming part of the solution by engaging in climate and environmental protection.

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