Volkswagen picks San Diego’s Qualcomm to supply chips for autonomous driving efforts

Qualcomm has inked a deal to supply chips to Volkswagen Group to help power driver assistance and autonomous driving features in the German auto maker’s vehicles starting in 2025.

The financial terms were not disclosed. The companies haven’t said yet which models would be the first to get Qualcomm Snapdragon Ride processors for Advanced Driver Assistance Systems (ADAS) and Level 4 autonomy —which means fully self-driving but with the motorists still behind the wheel to take control if necessary.

The agreement highlights the traction that Qualcomm—best known for designing chips that power Android smartphones—is getting as a technology supplier to vehicle makers as part of its diversification strategy.

The San Diego company rung up nearly $1 billion in automotive revenue in fiscal 2021. It’s on pace to beat that amount this year. Its pipeline of pending orders totals $16 billion, with customers including BMW, GM/Cadillac, Ferrari, Renault, Chrysler, Dodge, Jeep and Fiat, among others.

Under terms of this Volkswagen deal, Qualcomm will supply Snapdragon Ride processors to CARIAD , a division created in 2020 by Volkswagen Group to develop a unified software platform across its brands, which include Audi, Porche and Bentley.

“With our automated driving solutions, we are striving to let customers take their hands off the steering wheel in the future,” said CARIAD Chief Executive Dirk Hilgenberg in a statement. “Our software and Qualcomm Technologies’ high-performance (hardware) are the perfect match to bring this new automotive experience to customers around the world.”

Qualcomm has its own ADAS and autonomous driving software stack. It includes drive policy and other functionality that it got through its recent acquisition of Arriver.

But Qualcomm’s Snapdragon Ride platform is open—meaning it can be tailored to run software developed by others, including automakers themselves.

This flexibility is how Qualcomm aims to compete against Intel’s Mobileye, the industry leader in ADAS/autonomous driving technology.

“As the amount of innovation and complexities increase, strong collaborations such as ours with CARIAD are a necessity to not only address aggressive time-to-market goals, but to deliver safe and reliable automated driving experiences for all,” said Nakul Duggal, senior vice president of automotive for Qualcomm, in a statement.

Qualcomm also aims to gain a foothold with automakers by supplying a wide range of technology products beyond ADAS/autonomous driving. They include chips and software that delivers connectivity, infotainment, telematics and digital dashboard capabilities.

Qualcomm’s shares ended trading Tuesday down slightly at $144.26 on the Nasdaq exchange.

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