Skip to main content
Sister Publication Links
  • Automotive News
  • Automobilwoche
  • Automotive News Canada
  • Automotive News China
Subscribe
  • Subscribe
  • Newsletters
  • Login
  • HOME
    • Latest news
    • Automakers
    • Suppliers
    • New Product
    • Environment/Emissions
    • Sales By Market
    • On The Move
    • Auto Shows
    • Munich Auto Show
    • Geneva Auto Show
    • Paris Auto Show
    • Beijing Auto Show
    • Shanghai Auto Show
  • Features
    • Long Read
    • Interview of the Month
    • Focus on Electrification
    • Focus on Technology
    • Segment Analysis
    • Cars & Concepts
    • Supplier Spotlight
    • Europe By The Numbers
  • Opinion
    • Blogs
    • Commentary
    • Guest columnists
  • Photos
    • Photo Galleries
    • Geneva Photo Gallery
    • Beijing Photo Gallery
    • Frankfurt Photo Gallery
    • Paris Photo Gallery
    • Shanghai Photo Gallery
  • Podcasts
  • Car Cutaways
  • EVENTS
    • ANE Congress
    • ANE Rising Stars
    • ANE Eurostars
    • Browse photos from the 2021 awards ceremony
  • More
    • Publishing Partners
    • Social Media
    • Contact Us
    • Media Kit
    • About Us
    • Capgemini: Securing the industry's future through a radical rethink
    • Capgemini: Succeeding with the automated driving journey through AI
    • HEXAGON: Plugging into data is the only way to make winning EVs
    • TUV Rheinland: Battery testing center for large battery packs and more
    • TUV Rheinland: Ideas, services and certifications for smart mobility
    • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
    • Toyota Europe
    • UFI Filters
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter
MENU
Breadcrumb
  1. Home
  2. Automakers
April 02, 2020 03:33 AM

Volvo, Veoneer split Zenuity software JV

Douglas A. Bolduc
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    A Volvo car with software co-developed with Zenuity is pictured at the autonomous vehicle testing facility AstaZero near Gothenburg, Sweden.

    Volvo and Swedish supplier Veoneer will split up their automotive software joint venture Zenuity, the companies said in separate statements on Thursday.

    Under the agreement, Volvo will set up a new stand-alone company to take over Zenuity's current development and commercialization of unsupervised autonomous driving software.

    Veoneer will integrate and operate the current Zenuity business focused on development and commercialization of advanced driver assistance system (ADAS) software.

    "The intent is for each party to pursue what’s the most critical core competence for them," Veoneer Chief Technology Officer Nishant Batra told Automotive News Europe. "Volvo wants to be a leader in autonomous driving and our intent is to more effectively pursue what we call advanced ADAS in the collaborative driving space."

    Since Veoneer serves all automakers, Batra said it made sense for it to take the part of Zenuity that works on ADAS because there is a much large market for driver assistance solutions than for autonomous driving technology.

    "A lot of the ADAS software within Zenuity is very mature," Batra said. "We are taking on something that we can use right away because there are already existing contracts."

    Those include providing the ADAS system in the full-electric Volvo XC40 Recharge compact SUV and the first volume model from Volvo subsidiary Polestar, the battery-driven Polestar 2 midsize sedan.

    Zenuity CEO Dennis Nobelius said that the supplier is not just providing its technology to Volvo, Polestar and other brands owned by China's Zhejiang Geely Holding.

    "Of the seven contracts we have for our ADAS business, four are with global brands outside of the Geely-Volvo Group," Nobelius told ANE.

    Zhejiang Geely also owns Geely Auto, Lynk & CO and UK sports-car unit Lotus.

    Pushing ahead

    Financial analysts Morgan Stanley said that expectations for the launch of fully autonomous driving were pushed back significantly last year, therefore it was not surprised that Veoneer will now focus just on ADAS solutions that help the driver without taking full control of the car.

    While some companies are slowing their move toward providing autonomous driving, Volvo CTO Henrik Green said that it remains strategic for the automaker.

    "We want to provide people the freedom to move in a safe, personal and sustainable way," Green told ANE. "AD [autonomous driving] is a key technology for us to help deliver on this promise."

    He said a benefit from the forthcoming split is that the new company that will be part of Volvo will be able to focus fully on the continued development of Zenuity’s so-called Z2 autonomous driving software for the next generation of its SPA architecture, known as SPA2.

    "This will enable autonomous driving functionality on highways, which we call Highway Pilot, that will assist you during your daily commute," Green said. "This will give the majority of the consumers a big benefit during a large portion of their daily commute."

    The system will provide Level 4 autonomy on sections of road where cars are allowed to drive themselves. "With that technology, we believe we can take a significant step forward on active safety, so that this where Volvo wants to put all its focus and effort."

    Volvo has previously said that its Level 4 autonomy would be ready in the early part of this decade. That number is starting to be more specific, but with some conditions.

    "If I would put a year on it today, it's 2022," Green said. "The main reason why we are not being overly specific is because we will always prioritize safety. We would never activate this function until we have fully verified that it's absolutely safe. It currently remains to be seen when we will feel truly comfortable that we can do so."

    People shuffle

    As part of the split agreement, Zenuity’s operations and people based in Gothenburg, Sweden, and Shanghai, China, will be transferred to the new company to be owned by Volvo. The operations and people based in Germany and United States will be transferred to Veoneer.

    As part of the split agreement, Zenuity’s operations and about 600 people based in Gothenburg, Sweden, and Shanghai, China, will be transferred to the new company to be owned by Volvo. The operations and about 200 people based in Munich, Germany, and Novi, Michigan, in the U.S. will be become part of Veoneer's R&D organization.

    Veoneer expects to achieve annual savings of $30 million to $40 million because of the split. The supplier also expects to receive a payment of about $15 million from Volvo once the deal is finalized.

    Morgan Stanley said in a note Thursday that Zenuity's losses since it was formed in 2017 have been $50 million to $70 million a year and that it anticipates ongoing losses of $50 million annually. 

    The split was expected to be finalized in the third quarter at the latest, the companies said.

    Reuters contributed to this report

    RECOMMENDED FOR YOU
    Former BMW CFO plans rapid expansion in electric van sector including U.S. plant
    Recommended for You
    B-ON Vehicle Family
    Former BMW CFO plans rapid expansion in electric van sector including U.S. plant
    Mercedes Citan
    Mercedes denies report that it has discussed sale of van business
    Fiat New 500 red front 2022
    Stellantis takes $52 million stake in sustainable lithium miner Vulcan Energy
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Get Free Newsletters

    Sign up and get the best of Automotive News Europe delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    SUBSCRIBE TODAY

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    SUBSCRIBE NOW
    Connect with Us
    • Twitter
    • Facebook
    • LinkedIn
    • Instagram

    Founded in 1996, Automotive News Europe is the preferred information source for decision-makers and opinion leaders operating in Europe.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI  48207-2997
    Tel: +1 877-812-1584

    Email Us

    ISSN 2643-6590 (print)
    ISSN 2643-6604 (online)

     

    Resources
    • About us
    • Contact Us
    • Advertise with us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Awards
    • Rising Stars
    • Eurostars
    • Leading Women
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News Europe
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • HOME
      • Latest news
      • Automakers
      • Suppliers
      • New Product
      • Environment/Emissions
      • Sales By Market
      • On The Move
      • Auto Shows
        • Munich Auto Show
        • Geneva Auto Show
        • Paris Auto Show
        • Beijing Auto Show
        • Shanghai Auto Show
    • Features
      • Long Read
      • Interview of the Month
      • Focus on Electrification
      • Focus on Technology
      • Segment Analysis
      • Cars & Concepts
      • Supplier Spotlight
      • Europe By The Numbers
    • Opinion
      • Blogs
      • Commentary
      • Guest columnists
    • Photos
      • Photo Galleries
      • Geneva Photo Gallery
      • Beijing Photo Gallery
      • Frankfurt Photo Gallery
      • Paris Photo Gallery
      • Shanghai Photo Gallery
    • Podcasts
    • Car Cutaways
    • EVENTS
      • ANE Congress
      • ANE Rising Stars
      • ANE Eurostars
        • Browse photos from the 2021 awards ceremony
    • More
      • Publishing Partners
        • Capgemini: Securing the industry's future through a radical rethink
        • Capgemini: Succeeding with the automated driving journey through AI
        • HEXAGON: Plugging into data is the only way to make winning EVs
        • TUV Rheinland: Battery testing center for large battery packs and more
        • TUV Rheinland: Ideas, services and certifications for smart mobility
        • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
        • Toyota Europe
        • UFI Filters
      • Social Media
        • Facebook
        • Instagram
        • LinkedIn
        • Twitter
      • Contact Us
      • Media Kit
      • About Us