Uber Technologies Inc. has agreed to purchase 24,000 of Volvo’s XC90 SUVs throughout 2019 to 2021 for its autonomous driving fleet. The deal is valued at approximately $1.4 billion; each XC90 is priced at $46,900 in the U.S., according to Financial Times.
Volvo’s says that its engineers have worked closely with Uber’s engineers to expand upon the XC90 SUVs. The two want to ensure safety and core autonomous driving technologies that Uber will use in the future.
Uber has already been testing autonomous vehicles in Arizona, San Francisco, and Pittsburgh.
“The automotive industry is being disrupted by technology and Volvo Cars chooses to be an active part of that disruption,” said Håkan Samuelsson, president and chief executive. “Our aim is to be the supplier of choice for AD ride-sharing service providers globally. Today’s agreement with Uber is a primary example of that strategic direction.”
Many other automotive manufacturers are racing to mass produce self driving vehicles, Volvo joins the competition now. Volvo intends to use the technologies developed with Uber for its own vehicle production in the future.
“This new agreement puts us on a path towards mass produced self-driving vehicles at scale,” said Jeff Miller, Head of Auto Alliances, Uber.
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. But with the current status of Uber, it may not be expected for a while.