Volvo Cars and Autoliv Inc.’s self-driving partnership is stepping up plans to dominate autonomous systems with talks to win customers other than the Swedish automaker’s Chinese parent, owned by top Daimler shareholder Li Shufu.
The Zenuity joint venture, set up over a year ago, is negotiating with five potential customers and plans to win at least one more deal this year after Li’s Chinese carmaking group ordered driver-assistance software for its Geely auto brand, Chief Executive Officer Dennis Nobelius said.
Zenuity software will be crucial to Volvo Cars’ aim of producing driverless models by 2021. It’ll also play a key role in Veoneer, the self-driving electronics and safety features unit air-bag maker Autoliv is spinning off. The venture already supplies driver-assistance system to Volvo, though Nobelius conceded Zenuity has to prove it’s able to win clients other than the Swedish carmaker or its owner to claim a position as a dominant supplier of autonomous-driving systems.
“My guess is that a couple of operating systems will remain a few years after 2020,” Nobelius said in an interview at Zenuity’s headquarters in Gothenburg, Sweden. “We have a complete solution, which not a lot of others have. So we expect and hope that ours will be one of those.”
Steps to build out Zenuity’s role in self-driving cars follow Li taking strides in acquiring stakes and brands in Europe’s automaking heartland. His Zhejiang Geely Holding Group Co. bought Volvo Cars in 2010, spending $11 billion to turn it around with an all-new model line. This year, he also became the biggest investor in Mercedes-Benz parent Daimler AG. Li is revealing his plans for the European rollout of his new mid-priced Lynk & Co. brand in Amsterdam later this month, after starting to sell vehicles in China in late 2016.
Zenuity will be competing with industry giants parts manufacturer Robert Bosch GmbH and software maker Google as well as groups led by car producers Toyota Motor Corp. and BMW AG. Volvo, the inventor of three-point safety belt, is keen to preserve its reputation for safety as it develops fully driverless systems for early in the next decade.
Nobelius declined to identify possible customers, who range from small startups to large, established automotive companies as well as “innovation leaders” that need software components rather than entire systems. Zenuity should still be competitive even with a direct workforce of just 500 people, because “with Veoneer’s resources, you get an additional 2,000 to 3,000 engineers globally,” he said.
Zenuity has signed agreements with artificial-intelligence developer Nvidia Corp., navigation company TomTom NV and Ericsson, a platform provider for the so-called internet of things. It’s also pursuing partners for mapping services in China. Once that’s in place, “we have the ecosystem we need to launch this,” Nobelius said.