In South Africa, the week following the 2024 general election spawned a mantra for its political future – ‘coalition’ – a word that suggests compromise, checks and balances and hopefully, improved efficiencies. As our political honchos gear up for unchartered waters, two truck titans who have solid presences in South Africa are set to form a software development joint venture. Volvo Group and Daimler Truck plan to co-develop a software-defined vehicle platform to meet the demands of an increasingly digitised truck operating environment.
According to both organisations, a “shared ambition to lead the digital transformation to software-defined heavy-duty commercial vehicles” forms the core of the joint venture. To amplify their efforts, both companies have reached a preliminary agreement to establish a joint venture to develop a common software-defined vehicle platform and dedicated truck operating system, providing the basis for future software-defined commercial vehicles.
The intention is to make the new joint venture a leading developer of standardised hardware and software. This technical basis will then enable Volvo Group and Daimler Truck and potentially other partners to provide differentiating digital vehicle features for its products, ultimately enhancing customer efficiency and experience.
Volvo Group and Daimler Truck intend to be 50/50 partners in the joint venture, which will operate as an independent entity, with Volvo Group and Daimler Truck continuing to be competitors in all other areas of business.
Collaboration is crucial for digital truck advancement
In the context of the already-heavy investments into the transformation towards CO2-neutral drive technologies, cooperation on digital technology development has become even more vital to best meet development objectives and customer expectations within a feasible timeframe.
Martin Lundstedt, Volvo Group President and CEO states: “Volvo Group and Daimler Truck are combining forces to accelerate the customer benefits that a software-defined truck platform will bring. Given the rapid transformation of our industry, it makes sense to collaborate to accelerate development, increase volumes and share cost. Software-defined heavy-duty trucks represent a paradigm shift in the transformation of our industry. Making the truck a programmable device with standardised hardware and operating system for fast product updates will give both companies the opportunity to create value for our customers and their customers though differentiating digital services and solutions. Partnership is truly the new leadership.”
Martin Daum, CEO of Daimler Truck comments: “Just as important as the transformation towards CO2-neutral drive technologies is the digitalisation in the vehicle. Developing a common software-defined vehicle platform with Volvo Group will enable us to turn our vehicles into a programmable device. It will allow us to build differentiating digital vehicle features with significantly greater speed and efficiency for our truck and bus customers around the globe. Together with the Volvo Group we can develop a benchmark truck operating system and set an industry standard.”
The joint venture will be headquartered in Gothenburg, Sweden, incorporating existing assets and resources of both companies into the new organisation. The goal of both shareholders is to set the industry standard for a truck operating system and offer its products to other OEMs as well. To that end the joint venture will provide a common developer platform as a service, on top of which its customers can build differentiating software layers.
Volvo Group and Daimler Truck therefore will remain competitors and continue to differentiate their complete product and services offerings, including their respective digital solutions. Both companies will provide their own end-user applications on top of the platform to offer differentiating digital vehicle features to their respective customers.
The now signed preliminary agreement is non-binding. A final agreement is expected within this year, with the goal to close the final transaction in Q1 2025, subject to necessary examination and approvals by the respective authorities.
