Volkswagen Group announced the creation of a subsidiary called Volkswagen Autonomy (VWAT) on Monday, with the German car giant saying it planned to "make autonomous driving market-ready."
With offices in Munich and Wolfsburg, Volkswagen said that VWAT would aim to "bring a self-driving system… to market maturity." As well as its sites in Germany, Volkswagen said it also planned to establish companies in Silicon Valley and China in 2020 and 2021 respectively.
Alexander Hitzinger, the Volkswagen Group's senior vice president for autonomous driving, will manage the new company.
"We want to establish Volkswagen Autonomy as a global technology company where we bundle expertise from the automotive and technology industries, combining the agility and creativity of a high-performance culture with process orientation and scalability," Hitzinger said in a statement.
"We will continue to use synergies across all Group brands to reduce the cost of self-driving vehicles, high-performance computers, and sensors," he added. "We plan to start commercialising autonomous driving at a large scale around the middle of the next decade."
Monday's news is Volkswagen Group's latest move in the sector. In July, it announced "closer cooperation" on autonomous driving with Ford. A month earlier, in June, Volkswagen terminated its partnership with Aurora, a self-driving start-up which has been backed by Amazon.
The last few years have seen a range of tests and developments take place in the autonomous vehicle sector.
In September, Mike Hawes, the chief executive of the U.K.-based Society of Motor Manufacturers and Traders, told CNBC.com via email that the shift to connected and autonomous vehicles represented "the greatest change to how we travel since the invention of the car."
"But safety is the number one priority for the automotive industry and self-driving vehicles are still some way off because of the challenges involved with equipping them to handle all possible driving situations," Hawes added.