Autoliv Inc., a worldwide leader in automotive safety systems, and premium carmaker Volvo Cars, have signed a final agreement regarding the formation of a joint venture to develop software for autonomous driving and driver assistance systems. The joint venture was first announced in a letter of intent from fall 2016.
The joint venture, named Zenuity, will create a new entrant in the growing global market for autonomous driving software systems. It marks the first time a leading premium carmaker has joined forces with a Tier One supplier to develop new advanced driver assist systems (ADAS) and autonomous driving (AD) technologies.
As part of the agreement announced today, at the time of closing Autoliv will make a total investment of around 1.1 billion SEK (approximately $120 million USD) into the joint venture, the large majority of which is an initial cash contribution, and which also includes certain assets. Volvo Cars also will contribute certain assets to the joint venture. As previously announced, Autoliv and Volvo Cars will own the joint venture 50/50.
Headquartered in Gothenburg, Sweden, and with additional operations in Munich, Germany, and Detroit, Michigan, USA, the initial workforce of around 200 people will come from Autoliv and Volvo Cars. The company is expected to grow to more than 600 employees in the medium-term.
Operations are expected to start during the first half of 2017, after approvals from relevant competition authorities in several countries have been obtained and other customary closing conditions have been satisfied.
Both Autoliv and Volvo Cars will license and transfer the intellectual property for their ADAS systems to the joint venture. From this base, the company will develop new ADAS products and autonomous driving technologies. The new company is expected to have its first driver assistance products available for sale by 2019 with autonomous driving technologies following shortly thereafter.
The two companies say the mission for the joint venture is to use the latest ADAS/AD know-how to create robust and flexible solutions that are at the technological forefront – for today and tomorrow. Customers will be offered flexibility to choose based on a platform with modular solutions. The joint venture is further committed to shape the industry by spearheading solutions that continuously push autonomous driving boundaries.
Autoliv will be the exclusive supplier and distribution channel for all the new company’s products sold to third parties, and there will be no exclusivity toward any customer or the owners. Volvo Cars will source such products directly from the new joint venture.
As previously announced, Dennis Nobelius will be the CEO of the joint venture, which will be governed by a separate board of directors, and independently operate within its own facilities.
