Volkswagen (VW) is purchasing a controlling stake in Volvo’s WirelessCar, a digital service developer skilled in connected driving, for 1.1 billion Swedish crowns ($122 million), the companies stated on Wednesday.
The automaker said WirelessCar technology would further its mission of developing value-added services for consumers by allowing safe and stable data exchange between operating systems in its vehicles and a cloud platform it is working on with Microsoft.
The German automaker will purchase 75.1 percent of WirelessCar in the deal, which will permit Volvo to focus on commercial vehicles, its major business since it sold Volvo Cars in 1999.
Volkswagen has stated it aims to spend over 11 billion euros in electric vehicles, digitalization, autonomous driving and mobility services by 2023, with the bulk designated for electric vehicles.
WirelessCar has its own technology platform and makes digital services such as billing and safety and emergency breakdown services for clients consisting of Jaguar Land Rover, Daimler, Nissan and Volvo Cars.
The company has over 3 million active connected cars throughout the world and is expected to report earnings of about 500 million crowns in 2018, Volvo stated in its statement.