A non-binding agreement that would see Volvo Cars supply the on-demand taxi service provider Uber with up to 24,000 self-driving cars from 2019 to 2021 has been created, according to recent reports.
While the non-exclusive deal may not seem to mean much this far out (well, just 2–4 years from now, but that’s a long time in the sector), it seemingly does represent Uber’s efforts to not fall further behind its competitors — most of which seem to be getting closer to commercial self-driving taxi deployment by the day, while Uber remains bogged down in court with Waymo/Google.
Lyft, in particular, through its partnerships with various auto manufacturers and self-driving vehicle tech developers, seems to be getting fairly close to market readiness.
Reuters provides more: “Geely-owned Volvo said in a statement on Monday it would provide Uber with its flagship XC90 SUVs equipped with autonomous technology as part of a non-exclusive deal from 2019 to 2021. A Volvo spokesman said it covered up to 24,000 cars. The self-driving system that would be used in the Volvo cars — which have yet to be built — is under development by Uber’s Advanced Technologies Group.
“Should Uber buy all 24,000 cars, it would be Volvo’s largest order by far and the biggest sale in the autonomous vehicle industry, giving Uber, which is losing more than $600 million a quarter, its first commercial fleet of cars.”
As a reminder here, Uber has been using Volvo XC90s as its “self-driving” test mules in Pittsburgh (Pennsylvania) and in Tempe (Arizona). These vehicles are of course still accompanied by “engineers” who are required to take over when necessary, which is apparently fairly often.
While there’s a plug-in hybrid version of the XC90, we haven’t seen indication that Uber is buying that trim. However, the first time we know of that Uber publicly expressed interest in buying self-driving vehicles, it was in a claim that the company would buy 500,000 self-driving Teslas if Tesla could produce them. Here’s more from Steve Hanley on that:
“In the summer of 2015, Travis Kalanick, the boy-child founder of Uber, told Elon Musk if Tesla could build 500,000 self-driving cars, his company would buy them all. This was before Tesla began producing its first Model S sedans equipped with its Autopilot semi-autonomous driving system. Musk brushed off Kalanick at the time (and later indicated after much questioning that Tesla might be planning an Uber-like service itself), but Uber has been pursuing self-driving technology ever since and has made Pittsburgh the hub of its autonomous car research and testing.”
Additionally: “Last spring, a rumor surfaced in the German press that Uber had agreed with Mercedes to buy 100,000 self-driving versions of that company’s S Class sedan for delivery in 2020.”
Financial details on the deal haven’t been revealed publicly, but Volvo Cars CEO Hakan Samuelsson did reveal in an interview with Reuters that the self-driving XC90 SUVs would be sold at around the same profit margin as obtained when Volvo sells through dealerships.