Finance

Volvo in deal to supply Uber with self-driving taxis by 2019

Volvo in deal to supply Uber with self-driving taxis by 2019

The deal is an extension of an agreement Uber made with Volvo two years ago, when the company first began heavy research on autonomous vehicles.

"We believe this is a new segment, a new business", said Hakan Samuelsson, the Chief Executive of Volvo Cars, which is owned by Chinese carmaker Geely.

Uber has just taken another big step from a ride-sharing service to a transportation provider. The base vehicles feature core autonomous driving technologies that will enable Uber to add its own automation features as well, Volvo says.

Bloomberg reported the figure at 24,000 vehicles, to be delivered between 2019 and 2021.

Uber's head of auto alliances, Jeff Miller, said the deal "puts us on a path towards mass produced self-driving vehicles at scale". But with the current status of Uber, it may not be expected for a while.

Uber has already been experimenting with driverless technology in the USA, but this massive investment in hardware represents a big change in direction and the first such purchase by a ride-hailing provider.

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In addition to this, Volvo engineers have been closely working with Uber in order to manufacture a baseline vehicle with driverless technology built in its heart.

Uber wasn't immediately available to comment, and Volvo deferred questions to Uber.

Uber is already testing 200 of the automaker's cars in San Francisco, Pittsburgh and Tempe, Ariz.

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. Uber has also been in talks with SoftBank for a potential $10 billion investment, so this makes Uber's future look strong for the investment.

Many other brands of autonomous vehicles are planning o land their driverless cars on road.

Lyft, the main ride-hailing alternative in the USA, has said it's also building driverless cars but has mainly focused on partnerships.

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