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NVIDIA Teams With AB Volvo on Self-Driving Trucks

By Danny Vena - Jun 18, 2019 at 3:30PM

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The GPU maker's stock is climbing on this new strategic partnership.

NVIDIA ( NVDA -4.46% ) announced Tuesday it was partnering with Swedish company AB Volvo (NASDAQOTH: VOLVY) -- the world's second-largest commercial truck manufacturer (also known as the Volvo Group) -- to develop the artificial intelligence (AI) necessary to operate self-driving commercial and industrial trucks.

The companies said in a press release it had signed a multiyear agreement "to jointly develop the decision-making system of autonomous commercial vehicles and machines."

The system will employ NVIDIA's "end-to-end artificial intelligence platform for training, simulation and in-vehicle computing," and "the resulting system is designed to safely handle fully autonomous driving on public roads and highways." The pact will cover the computing fundamentals necessary to develop fully autonomous self-driving trucks, built on NVIDIA's DRIVE platform.

The focus of the partnership will be to develop a scalable autonomous-driving system, which the Volvo Group will use first in pilot projects, before offering the technology for sale in its commercial vehicles.

Jensen Huang, founder and CEO of NVIDIA, and Martin Lundstedt, president and CEO of the Volvo Group

NVIDIA founder and CEO Jensen Huang, and president and CEO of the Volvo Group Martin Lundstedt. Image source: NVIDIA.

An end-to-end solution

The Volvo Group will use NVIDIA's DRIVE autonomous-driving platform in the training, testing, and deployment of a wide range of self-driving vehicles. These will include passenger buses, tractor-trailer trucks, and trash and recycling collection vehicles, as well as the commercial vehicles used in construction, mining, forestry, and more.

Said Martin Lundstedt, president and CEO of the Volvo Group:

Automation creates real-life benefits for both our customers and the society in terms of safety, energy efficiency -- and as a consequence, productivity. We continue to gradually introduce automated applications in the entire spectrum of automation, from driver-support systems to fully autonomous vehicles and machines. This partnership with NVIDIA is an important next step on that journey.

The strategic partnership will cover the end-to-end computing that is fundamental to autonomous vehicles. It will include accelerated computing technology in the data center for training deep neural networks, the large-scale simulations and testing necessary to validate autonomous-vehicle systems. It will also include the deployment of the NVIDIA DRIVE platform in a vehicle running the entire system -- including 360-degree sensor processing, mapping, and route planning.

Why it matters

This would be a big deal for NVIDIA. The Volvo Group said it has built and sold almost 2.1 million trucks, 600,000 construction vehicles, and 100,000 buses over the past 10 years. The potential to automate many of these vehicles with self-driving capabilities powered by NVIDIA technology represents a massive opportunity.

NVIDIA pointed out that there are already more than 35 million packages delivered worldwide each day, and that number is growing by 28% each year. "By 2040, delivery services will have to travel another 78 billion miles each year to handle goods ordered online," the company said on its blog.

Autonomous delivery trucks could potentially help companies meet this soaring demand. Self-driving vehicles can operate 24 hours per day -- without sleep. They can also improve delivery times, increase safety and efficiency, and decrease the cost of logistics in the U.S. by as much 45%, according to data cited by NVIDIA.

There's little doubt that self-driving vehicles will play a big role in future transportation efforts. By supplying the foundational technology to a growing number of manufacturers, NVIDIA is positioning itself to benefit in an increasingly autonomous future.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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