DETROIT (Reuters) – Auto technology supplier Aptiv PLC and Volkswagen AG’s Audi brand are investing a combined US$285 million in vehicle software company TTTech Auto, giving the Austrian company a US$1 billion valuation, the companies said.

TTTech Auto develops software that automakers can use to manage data flowing from sensors and safety systems used to automate driving. The company’s Motionwise software also helps engineers develop new automated driving and safety software faster.

Aptiv will invest $228 million in TTTech Auto while Audi is investing $57 million, the companies said in a statement.

Established automakers like Volkswagen are scrambling for more software expertise through acquisitions, hiring campaigns and equity investments while trying to catch up with electric vehicle leader Tesla Inc.’s ability to rapidly improve vehicles through software upgrades.

TTTech Auto was founded in 2018 by aerospace company TTTech Group, South Korean technology company Samsung, Audi and chipmaker Infineon.

“We want to offer safety in aerospace at automotive costs,” said TTTech Auto Managing Director Georg Kopetz in an interview.

Aptiv, with annual sales of $15 billion, is working to grow its business by supplying hardware and software for electric vehicles and automated driving systems. Aptiv, Audi and TTTech Auto have worked together to develop the central driver assistance controller for automated driving in Audi vehicles.

With the fresh capital, Kopetz said, TTTech Auto plans to expand in Asia, scout for potential acquisitions and invest in the development of Motionwise software, which is currently used in about 2 million vehicles.

(Reporting by Joe White; Editing by David Gregorio)

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