Auto tech firm Veoneer teams up with Qualcomm on driver software

Veoneer will cooperate with Qualcomm Technologies on developing a software and chip platform for driver-assistance systems, the auto technology firm said on Thursday, sending its shares sharply higher.

The Swedish maker of vision systems, radar and software for advanced driver-assistance systems (ADAS) said it had signed a non-binding letter of intent with the U.S. firm and expected to finalise a definitive agreement in the second half of this year.

Veoneer's software development strategy, increasingly important with the auto industry in the midst of a rapid transformational shift, has been under scrutiny since it ended its Zenuity software joint venture with Volvo Cars in April.

"This is a significant event for Veoneer which we are very happy to announce,", Carlson told Reuters, adding that he expected the integrated software and system-on-a-chip platform would generate major interest from customers.

Shares in Veoneer were up 17.3% 1353 GMT. They are still down 18% so far this year.

Veoneer, which competes with companies such as Aptiv, Bosch, Continental and Intel's Mobileye, has been hit hard by the coronavirus pandemic as the car industry has seen production halted in many markets by widespread lockdowns.

Veoneer said in a statement it expected the integrated platform developed with Qualcomm to be available through automotive Tier 1 suppliers or directly to original equipment manufacturers (OEM) for 2024 vehicle production.

"This relationship not only strengthens our product portfolio, but also broadens our go-to-market position and opportunities, while giving customers more ways to access world-leading technology," Carlson said in a statement.

The company, which supplies carmakers such as Daimler, and Honda, said last month it expected sales this year to outpace light-vehicle production.