VW, Bosch Team Up on Self-Driving Software

A VW badge on the front of a Volkswagen ID.5 GTX all-electric automobile
A VW badge on the front of a Volkswagen ID.5 GTX all-electric automobile. (Krisztian Bocsi/Bloomberg News)

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Volkswagen AG is partnering with Robert Bosch GmbH to develop a common software platform to bring hands-free driving functions to the German carmaker’s entire fleet in a bid to compete with Tesla Inc.

The platform, announced by VW’s Cariad software unit and Bosch on Jan. 25, will serve all Volkswagen Group passenger vehicles before being opened to the wider industry. As a first step, the partners plan to roll out technology next year that will allow drivers to temporarily take their hands off the steering wheel via an over-the-air update.

“Speed is of the essence,” Cariad CEO Dirk Hilgenberg said. “Tesla, of course, has a million vehicles on the road, and those cars seem greater every day. With the cooperation we are now setting up, I think we can gain speed significantly.”

At peak times, the effort between Europe’s largest automaker and the world’s largest auto-parts supplier will involve more than 1,000 workers from both firms.

The pact unites two industry giants in the development of automated driving, a technology that could reshape the transport sector but is enormously complex and costly. It’s a boon to Germany’s efforts to catch up in a field Europe’s largest economy has identified as crucial for growth.

“Automated driving is key to the future of our industry,” Hilgenberg said in an earlier statement. “With our cooperation, we’ll strengthen Germany’s reputation for innovativeness.”

There’s ample competition. Daimler AG’s Mercedes-Benz last year won regulatory backing to deploy hands-free driving in Germany with a system approved for Level 3 automated driving — a notch higher than Tesla’s Level 2 Autopilot system. Intel Corp.’s Mobileye and Alphabet Inc.’s Waymo LLC as well as Baidu Inc. in China also are working on autonomous technology.

The VW-Bosch project involves using sensors and artificial intelligence tech to collect and analyze real-time traffic data for use in the software-development process. The goal is to introduce Level 2 and Level 3 systems for hands-free driving in urban environments and on freeways. The firms said they also are examining joint targets and timelines for Level 4 full self-driving.

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“The cooperation between Bosch and Volkswagen is an important step to tap into the new revenue pool software,” VW Chief Financial Officer Arno Antlitz said. “The components of the developed software can also be used for vehicles and ecosystems of other automakers in the future.”

Getting on top of vast amounts of data will be critical for autonomous driving, which Herbert Diess, VW’s CEO, expects to trigger an even deeper disruption for the industry than the shift to electric vehicles.

VW last month earmarked $101 billion (89 billion euros) for EV and software development over the next half-decade and in 2020 invested $2.6 billion in Argo AI, a Pittsburgh-based autonomous-driving startup also backed by Ford Motor Co.

Executives, including Oliver Zipse, CEO of BMW AG, recently have said they are open to more cooperation to share expenses on basic software frameworks as they don’t differ much from brand to brand. Still, the industry has a patchy track record of working together. Daimler and BMW announced a partnership in 2019 on what they referred to as “long-term cooperation” on automated driving tech, only to part ways less than a year later.


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