The reported 1.4 billion deal was announced in late November. According to the New York Times, Uber is set to purchase as many as 24,000 XC90 Volvos in the coming days, to include in their ride-share fleet. Conversations and collaborations between Uber and Volvo began two years ago, when talks of the future of driverless cars became a prime interest in the automotive industry.
Just last year, research firm Bloomberg New Energy released a report that contended that shared fleets of electric and self-driving cars would likely become the dominant mode of transportation in populated cities in the coming years. These fleets will be able to accommodate two to 20 passengers, and will be more cost-efficient than owning a car.
The report cited London, Singapore, and Shanghai as being cities projected to take on this innovative mode of transportation in the future, which would inevitably change the game of auto fleet management.
These cities were singled out because of their dense populations, history of investments into new modes of public transportation, and higher income levels.
Uber and Volvo are attempting to push the envelope in the area of ridesharing with their self-driving vehicles before competitors; their plan is to launch their self-driving fleet by 2019.
The XC90 is currently being tested in Pittsburgh, Arizona, and San Francisco, and currently starts at $46,900. Both Uber and Volvo have invested in the ambitious project, putting about $300 million towards the project, according to the Times.
Uber first worked with third-party manufacturers to come up with the autonomous driving technology for the vehicles, before taking the software to Volvo to add to their XC90 fleet.
Uber reportedly has their own in-house research and development team that has teamed up with various manufacturers and engineers in Pittsburgh, where most of their autonomous vehicle research has been taking place.
General Motors’ Plans for Robot Taxis
Uber isn’t the only well-known company playing around with the possibilities of auto fleet management. General Motors has recently announced their plans to launch their self-driving fleet as early as 2019 as well. This fleet would also provide a ride-hailing taxi service to densely populated cities.
GM’s autonomous vehicles are currently being tested in San Francisco, and Scottsdale, Arizona. The automotive company announced plans to offer rides to people at a low $1 a mile.
GM’s chief financial officer, Chuck Stevens, reportedly said: “There’s a very real potential that this business is bigger than our current business — at better margins and higher returns.”