As well as developing their own autonomous self-driving cars, Volvo are keen to be in the heart of the mobility shift self-driving technology will bring. The agreement is worth over $1 billion, according to a Wall Street Journal report. The Volvo XC90 is already the base of Uber's current self-driving test vehicle. Uber also paints the right to order vehicles from other OEMs to help contribute to its fleet as part of the deal. Uber has worked with third-party components manufacturers to build software and hardware for driverless cars, then worked closely with Volvo to outfit the automaker's XC-90 vehicles with the technology.
The non-exclusive agreement will see Volvo sell thousands of "base vehicles" to Uber between 2019 and 2021, as the latter gears up to offer "mass produced self-driving vehicles at scale".
Volvo XC90 usually costs $46,900 in the US for a base model on consumer pricing and the bulk dealing prices are not confirmed yet.
"Our aim is to be the supplier of choice for AD ride-sharing service providers globally".
Since August past year, Uber has been testing prototype Volvo cars in Arizona and Pittsburgh.
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Volvo added that engineers from both companies developed the XC90 premium SUVs that are supplied to Uber. The base vehicles feature core autonomous driving technologies that will enable Uber to add its own automation features as well, Volvo says.
Miller said the company hasn't determined which cities the self-driving Volvos will operate in, but noted that the company's initial focus will likely be in the United States, where Uber has test fleets in San Francisco, Phoenix and Pittsburgh.
Uber would not share financial information about the project, and Volvo did not immediately respond to a request for further comment.
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.
"It only becomes a commercial business when you can remove that vehicle operator from the equation", Jeff Miller, Uber's head of automotive alliances, told Reuters.