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Volvo Wants to Sell Cars Like Mobile Carriers Sell Phones

November 30, 2017 0 Comments

At the 2017 Los Angeles Auto Show yesterday, Volvo revealed a new way to own and operate its vehicles: Care by Volvo, where customers pay $600 a month to purchase an XC40 crossover SUV. The total includes the cost of the car, tax, delivery, insurance, and access to Volvo’s “concierge” service. Customers just pay for the gas.

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“What we think is lacking today is there’s ways to simplify getting your hands on a car, like getting a lease,” said Volvo’s Chief Digital Officer, Atif Rafiq. “But a subscription is entirely different [than] that because it solves for a bunch of wider things in actually owning a car. It’s not just getting the car, it’s maintaining it, it’s paying for additional things it needs like insurance. … all that in one flat fee is something simpler but is also more transparent.”


Customers can still buy or lease Volvos the old way, however, if they so desire.

The reveal follows Volvo’s press release last week announcing its plans to sell “tens of thousands” of “autonomous-ready XC90s” to ride-sharing company Uber between 2019 and 2021. Uber and Volvo have been working together closely to develop vehicles based on the automaker’s Scalable Product Architecture (SPA), which will incorporate the “safety, redundancy and core autonomous driving” hardware to make self-driving cars street legal, according to Volvo’s press release. To do its part, Uber will supply the self-driving software.

“We met up through a connection we got a couple of years back and understood quite early that we had a mutual interest here in developing autonomous cars, said Henrik Green, senior vice president of Research and Development at Volvo. “We’re developing the base car that has the redundancy, the electrical and the software architecture to drive a car that is then steered by an autonomous computer.”

Of course, Volvo’s collaboration with Uber is not the automaker’s only [attempt] to realize its self-driving aspirations.

“We are focusing our internal resources and our skills to develop the base car for autonomous drive [sic]. Next to that we are working on our own autonomous drive system for consumer, private owner experience, what we call the level 4 autopilot that we aim to go to market with in the 2021 timeframe,” Green said.

The collaboration with Uber is “acting as a prototype testbed” for Volvo, letting them develop autonomous systems more quickly.

The automaker has three initiatives: the base car (which needs to be compatible with self-driving systems), the “development of an autonomous driver application for retail customers,” and the “Drive Me” initiative, a research project “where the main focus is to understand how humans interact with the self-drive system,” according to Green.

Though the 2021 timeframe is fast approaching, there are still some technical and policy-based issues that need to be overcome. Just as first generation mobile phones were limited to areas with coverage, the first self-driving vehicles might only be usable in specific designated spaces.

“When we launch the first commercial applications for the autopilot, I believe there will be designated areas where [its use] is approved and safe, and it’s all tested and the mapping is done,” said Green. “And those maps we grow over time — quite rapidly, I hope.”

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The DrivingSales News team is dedicated to breaking the relevant and the tough stories affecting car dealers. Have questions for DrivingSales News? Reach the team at news@drivingsales.com.

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