Volkswagen and Microsoft are collaborating to develop a new automotive cloud solution that will form the foundation of the car manufacturer’s digital transformation.

The ‘Volkswagen Automotive Cloud’ will be used for all future Volkswagen digital services and mobility offerings.

“The strategic partnership with Microsoft will turbocharge our digital transformation,” said Herbert Diess, CEO of Volkswagen. “Volkswagen, as one of the world’s largest automakers, and Microsoft, with its unique technological expertise, are outstandingly well-matched. Together, we will play a key role in shaping the future of auto-mobility.”

“Volkswagen is harnessing technology to digitally transform and deliver innovative new connected car services to its customers,” said Satya Nadella, CEO of Microsoft. “The world’s leading companies run on Azure, and we are thrilled that Volkswagen has chosen Microsoft. Together we will reimagine the driving experience for people everywhere.”

From 2020 onwards, more than five million new Volkswagen brand vehicles per year will be fully connected and will be part of the internet of things (IoT) in the cloud. All in-car services for vehicles of the core Volkswagen brand as well as the group-wide cloud-based platform (also known as One Digital Platform) will be built on Microsoft’s Azure cloud platform and services as well as Azure IoT Edge. This will streamline the technical landscape.

As part of the new entity, Volkswagen will establish a new automotive cloud development office in North America near Microsoft’s headquarters. Microsoft will provide hands-on support, including resources to help drive hiring, human resources management and consulting services. The workforce is expected to grow to about 300 engineers in the near future.

Beyond the technological rationale of the partnership, Microsoft provides access to cloud expertise so Volkswagen developers and engineers can benefit and learn from Microsoft’s culture of collaboration and agility and can transfer those experiences into the core Volkswagen organisation.

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