The Volkswagen Group is acquiring a majority stake in Swedish telematics specialist WirelessCar from Volvo for an undisclosed amount.

The Volkswagen Automotive Cloud will link the fully connected vehicle, the cloud-based platform and digital value-added services

The deal for a 75.1% stake will help Volkswagen further advances in vehicle connectivity and follows VW’s announcement this summer of plans to expand into digital services for fleets and mobility solutions such as car sharing as it positions itself as a provider of both hardware and software.

Based in Gothenburg, WirelessCar was founded in 1999 and has been a wholly-owned subsidiary by Volvo since 2007. It’s acknowledged as a leading specialist in vehicle connectivity and has its own technology platform and as well as developing digital services, including concierge and billing service, for example for tolls, as well as safety and emergency services, such as remote diagnostics.

In its announcement this summer, VW Group said that it would be launching a range of features and services, with third-party involvement vital and the tie-up with WirelessCar will play a key role on this. The group will use WirelessCar’s connectivity technology to drive the development of the digital ecosystem. The goal is to provide full connectivity in future vehicle generations and develop value-added services for customers that they can access via the Volkswagen Automotive Cloud. WirelessCar joins Microsoft and diconium as the third major technology partner involved.

While VW is working with Microsoft to develop the cloud-based platform together with Microsoft, and designing a customizable marketing platform (service platform) for all digital services with diconium, the group said that the WirelessCar technology will enable safe and stable data exchange between the vehicle’s operating system and the cloud-based platform, and forming an essential basis for the future software architecture in the vehicle.

“Our aim is to develop the Volkswagen into a mobility provider with a fully-connected fleet,” Christoph Hartung, head of digital & new business / mobility services at the Volkswagen brand, said. “Our customers will be able to use digital value-added services in their cars or on their mobile devices at all times. We are switching up a gear with this development and have gained WirelessCar as the third major partner. We are now really stepping on the gas and focusing on integrating the technologies.”

Martin Rosell, CEO of WirelessCar, said: “Volkswagen is our ideal partner for the next stage in our development. Volkswagen has the most ambitious future strategy for connectivity in the automotive industry. This aspiration is the perfect match for our vision to lead the automotive industry into the digital society. We are highly motivated and willing to play our part to make a difference.”

Completion of the deal is expected in the first half of 2019 and is subject to approval from antitrust authorities.