Volkswagen revealed its software business unit Cariad will spend $2.26 billion and pick up 60 percent stake in a new venture with Chinese technology firm Horizon Robotics.
Volkswagen will invest $1 billion in Horizon Robotics. Volkswagen will invest another $1.26 billion in the joint venture for 40 percent stake, while the remaining 60 percent stake will be with Horizon Robotics. The transaction will be completed in the first half of 2023.
Horizon Robotics and Volkswagen software business unit will develop technology that can integrate numerous functions for autonomous driving onto a single chip that will be available only in China.
CARIAD and Horizon Robotics will develop full stack ADAS/AD solutions for China to drive forward the integration of several functions on one chip, enhancing the stability of the system, saving costs, and reducing energy consumption.
Volkswagen will have a supplier in major regions — North America, Europe and China — given its existing supply relationships with chipmakers Qualcomm and STMicrolectronics, Reuters news report said.
In contrast to the partnership with Qualcomm, Volkswagen’s software unit Cariad will play an active role in developing the chip technology with Horizon Robotics, and the know-how will be shared across the Volkswagen Group, the carmaker’s China chief Ralf Brandstaetter said.
The investment is part of a wider push by Volkswagen to strengthen its software offering and make its mark on the Chinese electric vehicle market. Volkswagen is behind domestic competitors – notably BYD and Tesla.
Cariad is an important force in the Group’s transformation into a software-driven mobility provider. “Through the joint venture with Horizon Robotics in China and further investment in autonomous driving technology, we are underlining our position in innovation and modernization in China’s automotive industry,” said Cariad CEO Dirk Hilgenberg.
Horizon Robotics, founded in Beijing in 2015, has supplied customers including BYD, Volkswagen’s Audi, Continental, Li Auto and SAIC, according to its website.
Investors of Horizon Robotics include carmakers like BYD and Great Wall Motors as well as Intel.
