Volvo signs deal with Uber for self-driving auto supply

Gladys Abbott
November 21, 2017

Uber and Volvo have reached a non-binding agreement whereby the Swedish carmaker will supply 24,000 self-driving cars to Uber. The deliveries of Volvo's purpose-built XC90's are planned for 2019-2021. Previously, we've seen Uber test its self-driving Volvo XC90 SUVs in Pittsburgh, and the company has already established a strong and strategic partnership with Volvo since August 2016.

Jeff Miller, Uber's head of vehicle partnerships said: "In a self-driving world there is no human, so you need redundant steering and braking and actuation systems, such that if there is an electrical or mechanical failure, the back-up system can kick in".

Volvo will provide 24,000 "scalable" autonomous cars to Uber, enabling the ride-sharing firm to develop and implement its own driverless technology system...

This latest move by Uber obviously contrasts with the company's current business model of its almost 2 million drivers each supplying and maintaining their own vehicles.

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Anthony Levandowski, who used to work for Waymo, left the company in January 2016 to found self-driving start-up Otto, which Uber swiftly purchased in July past year for $700m (£558m).

"The automotive industry is being disrupted by technology and Volvo chooses to be an active part of that disruption", Volvo CEO Hakan Samuelsson said in a statement. Volvo told Reuters it would sell the XC90s to Uber at roughly the same profit margin it sells through dealers, suggesting Uber's total purchase could top $1 billion. It worked as a safety driver would sit in the front seat in an attempt to intervene if something goes wrong.

Although, Uber and Volvo have entered into an agreement, there is still no time period set when Uber will launch its driverless ride hailing service.

The XC90 will take a testing period with safety driver and then the company will make a test of the vehicle running without safety driver so as to check whether the auto is able to give proper autonomous driving.

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