Today’s announcement that automotive technology company Veoneer and microchip giant Qualcomm have signed a collaboration deal is another sign that cooperation in the sector is accelerating.
Veoneer and Qualcomm will collaborate on the delivery of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions. Their joint platform will integrate Veoneer's perception and driving policy software and Qualcomm’s Snapdragon Ride ADAS and AD.
Collaborations in the automotive world are nothing new. Making vehicles and vehicle parts is expensive, as well as research and labour intensive, so companies often work together to ease the load.
However, today’s original equipment manufacturers and suppliers face a complex environment unlike anything the industry has experienced before. Electrification, autonomous vehicles, new entrants to the industry, and the growth of mobility as a service. These factors are all feeding an appetite for increased cooperation.
If properly considered and documented, collaborations and joint ventures can help control costs and drive transformational change. Here are five things automotive brands might want to think about when entering into a joint venture:
- Plan your joint venture journey. Before you enter into any contract, you may need to put in place preliminary documents or give consideration to protecting your commercial interests during negotiations. Consider whether you wish to have a period of exclusive negotiation, or whether confidentiality undertakings are needed. Also think about whether it would be helpful to agree heads of terms in respect of the proposed collaboration.
- What’s the best vehicle? Think about whether the relationship will be a purely contractual cooperation, or whether it would be a good idea to set up a separate corporate vehicle to carry out any part of a project. If you decide that a contractual arrangement is the most appropriate structure, is there any risk that the joint venture could be considered to be a partnership?
- Where are we going? Be clear from the outset as to the main aims of the venture, as this will determine what your and your partner’s contractual obligations ought to be. What’s the main purpose of the venture? Is it intended that the project will be ongoing or last for a limited period of time? What are your and your partner’s commercial and strategic objectives?
- Whose role is it? Be clear about your roles in, and contributions to, the venture, and what you are each prepared, and able, to contribute. What duties and obligations will you each have? What rights will you grant to each other and to third parties, e.g. licences to use intellectual property? How long is the relationship intended to last and how can you bring it to an end? How will the costs of the project be met?
- Who owns the IP? Who will own any intellectual property rights developed during the course of the venture? How will you each need access to, or licences to use, confidential information, know-how and other intellectual property developed in the course of the venture?
Veoneer and microchip giant Qualcomm have signed a collaboration deal to develop a software and chip platform for advanced driver-assistance systems, Veoneer said in a statement Tuesday.