Volvo, Uber form autonomous alliance with $300M initial investment

Both companies will collaborate on a new vehicle design, built by Volvo and purchased by Uber.

Volvo and Uber have announced a deep partnership focused on bringing autonomous technology to market.

The companies plan to spend $300 million to collaboratively design a new vehicle based on Volvo's modular Scalable Product Architecture (SPA) platform, currently shared between the XC90, S90 and V90.

The base vehicles will be built by Volvo and purchased by Uber. The ride-hailing company will consider additional refits to deploy self-developed autonomous driving systems geared for its particular market strategy. The automaker will presumably adapt its own model to accommodate traditional car owners.

"The Volvo-Uber project marks a significant step in the automotive business with a car manufacturer joining forces with a new Silicon Valley-based entrant to the car industry, underlining the way in which the global automotive industry is evolving in response to the advent of new technologies," the companies said in a joint statement. "The alliance marks the beginning of what both companies view as a longer term industrial partnership."

Volvo and Uber are not the first such companies to form a partnership for autonomous vehicles. General Motors and Lyft are said to be working toward similar goals, while Google and Fiat Chrysler are collaborating on self-driving Chrysler Pacifica prototypes.

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