Volvo looks to supply Uber with up to 24,000 self-driving cars
Uber plans to buy up to 24,000 self-driving cars from Volvo, marking the transition of the U.S. firm from an app used to summon a taxi to the owner and operator of a fleet of cars.
The nonbinding framework deal could offer San Francisco-based Uber a way to overcome setbacks at its autonomous driving division in Silicon Valley’s race to perfect self-driving systems.
Combining Volvo’s cars with Uber’s self-driving system builds on their nearly three-year relationship and comes as Uber’s autonomous driving unit has been hit by a lawsuit over trade secrets and the departure of top talent.
Automakers, ride-hailing firms and tech startups have been forging loose alliances in an effort to advance self-driving technology and claim a piece of what is expected to be a multibillion dollar business.
Volvo said in a statement Monday it would provide Uber with its flagship XC90 SUVs equipped with autonomous technology as part of a nonexclusive deal from 2019 to 2021. A Volvo spokesman said it covers up to 24,000 cars.
The self-driving system that would be used in the Volvo cars — which have yet to be built — is under development by Uber’s Advanced Technologies Group.
Should Uber buy all 24,000 cars, it would be Volvo’s largest order by far and the biggest sale in the autonomous vehicle industry, giving Uber, which is losing more than $600 million a quarter, its first commercial fleet of cars.
A new Volvo XC90 typically retails from a starting price of around $50,000.
Uber has been testing prototype Volvo cars for more than a year, with safety drivers in the front seat to intervene if the self-driving system fails, in Tempe, Arizona, and Pittsburgh.
“Our goal was from day one to make investments into a vehicle that could be manufactured at scale,” Jeff Miller, Uber’s head of automotive alliances, said.