VW seeks to remedy software woes with $3.7 billion spend on JV

Volkswagen group’s troubled software subsidiary has now started a $3.7 billion AUD joint venture with Horizon Robotics which currently provides computing solutions to smart vehicles in China.

This comes after Volkswagen’s previous CEO resigned from his global role which many in the industry attributed to the troubled software development program in the company.

The deal is set to help Volkswagen’s software development subsidiary, Cariad, develop smarter driving technology locally.

According to Horizon Robotics, Volkswagen’s investment will have a 60% stake in the joint venture once it’s finalised in the first half of 2023. The process to complete this deal involves government approvals and foreign investment authority approvals.

These vehicles are equipped with Volkswagen’s latest software which users in other markets have reported to have lots of issues. Some of the issues were discovered by an owner and YouTuber, Alex Guberman.

Some software issues faced by owners included:

• The charging connector doesn’t release as it should when unlocking the doors
• The tire pressure monitoring system gives false low-pressure warnings and also fails to display the actual tire pressure
• Very long bootup period for the infotainment system
• Android Auto fails to connect and sometimes disconnects while driving
• While responding to voice messages, the audio lowers or turns off after the message is sent
• The centre infotainment screen shuts off and reboots randomly
• The backup camera often doesn’t work properly
• The smartphone app throws random error messages and takes too long to connect

With many more owners reporting similar problems, Volkswagen has had to find partners that can help them fix these problems in markets that are most important to the company. This was reiterated by Ralf Brandstätter who is a member of the Volkswagen AG board in China:

“The partnership with Horizon Robotics is a central cornerstone of our strategy to realign and further strengthen our activities in our most important market worldwide,” said.

Volkswagen is yet to deliver any of its latest ID series EVs to Australian customers but has plans to do so. Recently there have been multiple spottings of the ID.4 EV SUV and the brand does plan to bring them into Australia over the next 18 months.

Hopefully, VW EVs can get here sooner. Software development joint ventures like those with Horizon Robotics can help Volkswagen deliver a better experience to EV owners. This will in turn help with retaining their customer base for when they decide to make the switch to an EV.