Volkswagen Group opened its software subsidiary to China and will launch the operating system VW.OS in 2025

Economic Observation Network reporter Zhou Ju Based on China's rapid development in intelligent networking, international car giants are strengthening local software technology research and development in China. The opening of new software subsidiaries in the Chinese market has also become a new fashion for international car companies in their localization work in China.

On April 28, CARIAD, a new software company under the Volkswagen Group, officially established its Subsidiary in China. According to reports, the CARIAD China team will promote the development of software products for Chinese consumers, including the joint development of a unified and scalable new software platform with the headquarters, advanced driver assistance systems and autonomous driving, and next-generation intelligent interconnection functions.

CARIAD is an automotive software company under the Volkswagen Group, established in 2021 to consolidate and enhance the software strength of the Volkswagen Group. CARIAD was formerly known as the Car.Software Organisation, Volkswagen's software division established in 2020.

According to reports, CARIAD has integrated more than 15 software companies and has about 5,000 engineers and developers in more than 70 countries. Previously, CARIAD has established R&D centers in Wolfsburg, Ingolstadt, Stuttgart, Berlin, Munich and other cities in Germany, and has also established close cooperation with the international R&D teams of the Volkswagen Group in the United States and China.

CARIAD's China subsidiary is CARIAD's first subsidiary outside of Europe, reflecting the strategic importance of China as the largest single market for the Volkswagen Group.

"China leads the world in digital applications and innovation, and consumers are increasingly demanding new features and new experiences. The establishment of the China team allows us to respond more quickly to the needs of the local market. Based on local customer experience and expectations, we will develop, iterate and continuously improve our products at Chinese speed. Chang Qing, CEO of CARIAD's China subsidiary, said.

Chinese auto consumers have higher expectations for intelligent network connectivity. According to McKinsey data, compared with the European and American markets, Chinese consumers care more about the intelligent experience, and more than 80% of Chinese consumers believe that autonomous driving and intelligent interconnection functions are very important to them.

Specifically, in the future, CARIAD China team will promote the development of software products for Chinese consumers, including advanced driver assistance systems and autonomous driving, next-generation intelligent interconnection functions, intelligent cockpit and body design, big data and software operating systems. In addition, the China team will work closely with the Volkswagen Group's brands in China and three joint venture partners to provide consumers with software-defined mobility solutions to achieve group scale at the software level.

In addition, CARIAD's China subsidiary will work with its European headquarters to develop a unified and scalable software platform for all Group brands to meet the specific needs of different markets. The entire technology stack will be launched around 2025 and will be pre-equipped with L4 level autonomous driving technology.

According to Changqing, the software platform developed by CARIAD for the Volkswagen Group will be divided into three stages: the first stage is volume production ( Volume), which is suitable for the mass production software platform of the MEB platform model, and the Chinese team will lead the realization of remote online update of software on the ID. family series of products in China, that is, OTA. The first update is expected to take place in the second half of 2022.

The second phase is Premium, which is aimed at the PPE platform, supporting advanced infotainment systems and advanced driver assistance systems based on the Android open source system, and supporting remote online updates on some Audi and Porsche brand models. It is scheduled to launch within the next two years. The China team will lead the specific application of the high-end software platform for the PPE platform in China.

The third phase is unified and scalable, which will be equipped with the SSP platform, applicable to all brands of the group, supporting volkswagen's self-developed operating system VW. OS, and connect to the Volkswagen Cloud VW.AC. This technology stack will be launched around 2025 and will be pre-equipped with L4 level autonomous driving technology.

By 2030, CARIAD wants this technology stack to be operational on 40 million vehicles worldwide. Among them, the Chinese team will lead and participate in 70% of the research and development work involving the new software platform technology stack and product line, including local research and development and adaptation.

In terms of talent, CARIAD said that by integrating the best talents in the Volkswagen Group (China), the Volkswagen brand and the Audi brand, it has formed a strong Chinese team. CarIAD currently employs more than 600 people in China and expects to double by the end of 2023, with more than 90 percent of them being local software talent. At the same time, CARIAD is building R&D forces in Beijing, Shanghai, Chengdu and Hefei to gradually build a national distributed R&D network.

At present, Volkswagen is actively transforming to electrification and intelligence. In July last year, the Volkswagen Group released its 2030 NEW AUTO strategy, which said it would accelerate its transformation into a software-driven mobility service provider. According to Volkswagen's New Auto strategy, it will strengthen its software development capabilities, derive new business models, and ultimately shift its profitability to software and services, becoming a software-driven mobility service provider. CARIAD and CARIAD's Chinese subsidiary are a key step towards electrification and intelligence.

In fact, not only Volkswagen, under the pressure of the "new four modernizations" of automobiles, many car giants have also been strengthening software development in China. For example, BMW Auto established Lingyue Digital in Beijing in 2019, focusing on creating a seamless customer digital journey. In 2021, BMW established BMW ArcherMind Information Technology Co., Ltd. and Lingyue Nanjing Branch in Nanjing, focusing on the development of vehicle-machine software and enterprise IT system development respectively. It can be seen that China is becoming the vanguard of more and more multinational car companies in terms of intelligent networking.