Veoneer will cooperate with Qualcomm Technologies on building a computer software and chip system for driver-guidance methods, the car technological innovation company stated on Thursday, sending its shares sharply higher.

The Swedish maker of eyesight methods, radar and computer software for sophisticated driver-guidance methods (ADAS) stated it had signed a non-binding letter of intent with the US company and anticipated to finalise a definitive settlement in the 2nd half of this calendar year.

Veoneer’s computer software progress approach, increasingly important with the car market in the midst of a quick transformational change, has been beneath scrutiny considering the fact that it ended its Zenuity computer software joint venture with Volvo in April.

“This is a considerable function for Veoneer which we are really happy to announce,” Carlson told Reuters, incorporating that he anticipated the integrated computer software and program-on-a-chip system would create important desire from consumers.

Shares in Veoneer ended up up seventeen.3 percent at the time of producing. They are nonetheless down 18 percent so significantly this calendar year.

Veoneer, which competes with businesses these types of as Aptiv, Bosch, Continental and Intel’s Mobileye, has been hit challenging by the coronavirus pandemic as the motor vehicle market has witnessed creation halted in a lot of markets by widespread lockdowns.

Veoneer stated in a statement it anticipated the integrated system created with Qualcomm to be available as a result of automotive Tier one suppliers or straight to first machines manufacturers (OEM) for 2024 vehicle creation.

“This romance not only strengthens our products portfolio, but also broadens our go-to-industry place and alternatives, even though supplying consumers additional methods to obtain environment-primary technological innovation,” Carlson stated in a statement.

The corporation, which materials carmakers these types of as Daimler, and Honda, stated final month it anticipated income this calendar year to outpace mild-vehicle creation.