Volvo has announced it will sell up to 24,000 autonomous drive compatible vehicles to Uber over the course of 2019-21 as the internet giant transforms its business.
The pair have been in partnership for three years, jointly developing an autonomous driving platform. Uber is in numerous partnerships throughout the industry, though this is one of the first concrete moves towards creating its own fleet, taking the brand out of the virtual world and giving it some physical assets.
“The automotive industry is being disrupted by technology and Volvo Cars chooses to be an active part of that disruption,” said Håkan Samuelsson, CEO of Volvo. “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.”
As part of the agreement, Volvo will supply Uber with XC90 SUVs equipped with autonomous technology, though Uber will also be installing its own systems on the vehicles. While wide-scale adoption of self-driving technology is still probably years away, it does come at a time where there is a lot of posturing.
The move does also indicate another potential storm on the horizon for the Uber business. If it thought it was getting a tough time from traditional taxi drivers for under-cutting their services, wait till it starts making the concept of a taxi-driver redundant. The distaste which Uber might receive could very quickly turn to hatred as numerous people are left jobless.
According to the Office of National Statistics, there were 356,300 taxi or private hire vehicle driver licences in England during 2017. We don’t have the numbers to hand, but we are guessing additional Uber drivers increased this number as taxis became more affordable. Should Uber prove the economics of autonomous taxis, that will be 356,300 people who will be quite p*ssed off.
Another interesting area to keep an eye on is the trend of internet giants gradually moving into the physical world. Amazon has done it with its acquisition of Whole Foods, while alongside Google, it has also been making inroads in the smart speaker space. By purchasing its own fleet, Uber can no longer distance itself from the physical world and its regulations; what impact this has on the way the company’s business model remains to be seen.
The ride sharing space is starting to heat-up and the internet firms have shown thus far they have no issue in bloodying noses and p*ssing the right and wrong people. The autonomous vehicles space still has a huge number of unanswered questions, but as with the internet age, Uber seems like it might cash in during the chaos once again.