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In the race to develop autonomous driving technology, German auto giant Volkswagen is taking a significant step by developing its own artificial intelligence (AI) chips in China.
“By developing systems on a chip in China, we are taking charge of a key technology that will shape the future of intelligent driving,” said CEO Oliver Blume at the China International Import Expo in Shanghai.
Carizon, a joint venture between Volkswagen’s software subsidiary Cariad and Chinese autonomous driving specialist Horizon Robotics, is in charge of developing a chip that processes data from driving cameras and sensors.
Volkswagen expects delivery in the next three to five years.
For the first time, Carizon is not only developing software for automated driving but also an AI chip, Cariad board member Peter Bosch said.
Blume explained that the Volkswagen Group’s strategy is summarized in a five-year plan. The mission is to become a leader in automotive technology, according to Blume.
The announcement comes amid concerns over the chips, fueled by the Nexperia dispute.
The Dutch company produces standard chips widely used in the automotive industry. However, disruptions in the export of Nexperia chips from China and concerns about supply issues are affecting European manufacturers, highlighting their reliance on these products.
With its in-house Chinese chip, Volkswagen wants to compete with Chinese rivals in autonomous driving. The company is investing more than 200 million euros ($230 million) in the new project, according to company sources.
In the world’s largest car market, where the business of German brands is shrinking, local manufacturers are gaining ground on their foreign competitors in driver assistance systems.
Well-known tech firms are helping big brands develop or are already involved in the automotive business themselves, such as Chinese smartphone maker Xiaomi.
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