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The Volkswagen Group announced its new joint venture with Chinese tech firm Horizon Robotics, with an investment of 2.4 billion euros (US$2.35 billion), eying the booming Chinese autonomous driving market, the firms said on Friday.
It’s one of the biggest investments in the autonomous driving sector this year, which reflects the confidence of global capital in the Chinese market, showing growing demands. Volkswagen’s software company CARIAD and Horizon Robotics plan to establish a joint venture, with CARIAD taking a majority 60 percent stake. Volkswagen will invest approximately 2.4 billion euros overall for the JV. The transaction, which requires regulatory approval, is expected to be completed in the first half of 2023. The JV will accelerate the regional development of advanced driver assistance systems (ADAS) and autonomous driving (AD) systems for the Chinese market.
Through the JV, CARIAD and Horizon Robotics will develop cutting-edge, highly optimized full stack ADAS/AD solutions for China to further the integration of numerous functions on one chip, increasing the stability of the system, saving costs and reducing energy consumption. The new joint venture will enable Volkswagen to tailor products and services faster and more consistently to the needs of our Chinese customers, according to the German carmaker.
“Horizon Robotics is committed to empowering smart vehicles to make human life safer and better,” said Yu Kai, founder and CEO of Horizon Robotics. “We believe our integrated software and hardware solutions will continue to position Horizon Robotics as a partner of choice for international auto makers in China.” China is expected to once again be the driving force for the world automotive market, with its auto sales accelerating further despite a global decline this year.
Global car sales are expected to fall by 3.2 percent in 2022, while those in the Chinese market will increase by 5 percent year on year, according to the CAR Center Automotive Research in Duisburg, Germany. Also in June, Continental invested in Motovis Intelligent Technologies, a Shanghai-based startup, to jointly develop Level 2 to 4 autonomous mobility services for the Chinese market and customers.