Uber has entered into an agreement with Volvo targeting up to 24,000 self-driving cars. The deal entails that the pick-up service will get the cars within the period of three years starting from 2019.
Uber and Volvo are yet to reveal price terms but have disclosed that both parties are free to form similar partnerships with other companies.
In the event that Uber buys all 24,000 XC90 sports utility vehicles (SUVs) indicated in the agreement, the deal could be worth $1.4bn (£1.1bn), according to an estimate by the Financial Times.
Under their pre-existing agreement, Uber already uses numerous customised Volvo vehicles, which include some of the carmaker's own self-drive hardware and then adds on its own proprietary artificial intelligence technologies.
Last year in the US Uber began testing prototypes of cars made by the carmaker. However experts have displayed pessimism over readiness of the driverless Uber cars believing that the vehicles may not be ready to begin until some years later.
Presently, tests are limited to Tempe, Arizona and Pittsburgh models.
While speaking on the idea of a totally driverless taxi service the Director at the consultancy IHS Automotive Paul Newton disclosed that "There is no legislation in any city of the world that would remotely allow this sort of thing to happen at the moment,"
"Our aim is to be the supplier of choice for autonomous driving ride-sharing service providers globally," said Volvo in a statement.
"Today's agreement with Uber is a primary example of that strategic direction."
"We're expecting Japan to be one of the first to allow 'level four' automation where you have the vehicle doing most of the work but still need a human with steering controls in the driving seat".
"But at 'level five' where it is a completely autonomous vehicle in every sense of the word is less likely to be around in this timeframe."
Another issue capable of impeding Uber's self-drive ambitions is a legal dispute with Waymo, a self-drive business owned by Google-parent Alphabet.
Waymo claims Uber benefited from the theft of some of its trade secrets and is seeking about $1.9bn (£1.4bn) in damages.
The case is due to go to court in San Francisco in early December.
