ServTech subsidiary signs virtual reality technology deal with Volvo
Vection has signed a virtual reality framework agreement with luxury car manufacturer Volvo.
A newly-acquired software development subsidiary of ServTech Global (ASX: SVT) has entered into a deal with luxury carmaker Volvo Car Italia SpA for the creation of interactive customer experiences designed to appeal to a broader market segment.
Vection Italy SRL this week signed the Virtual Reality Framework Agreement which will see Volvo adopt its proprietary virtual and augmented reality (VR) technology to strengthen its position in automotive innovation.
Vection’s first task under the agreement will be the development of an augmented reality marketing solution to showcase Volvo’s occupant protection and safety equipment including car safety cells and airbag systems.
The project is expected to be completed by month end and represents a revenue to Vection of approximately $30,000.
ServTech’s newly-appointed managing director Gianmarco Biagi (formerly Vection chief executive officer) said the agreement forms part of a broader global partnership strategy aimed at positioning Vection as the leading virtual reality software provider for tier one companies.
“The close collaboration with Volvo cements Vection’s position in the automotive industry, and supports Volvo in its growth and development strategy,” he said.
“Volvo’s adoption of virtual reality technology is critical to Vection’s positioning in the automotive industry and provides it with significant global exposure.”
Mr Biagi said the agreement would leverage the implementation of Vection’s virtual reality technology for luxury car markers such as Lamborghini and Ferretti Yachts, and apply it to the Volvo value chain.
Cost-effective technology
Vection’s VR technology enables automotive manufacturers to employ it as a cost-effective alternative to traditional fabrication of test models or other physical prototypes.
“The design process is one of the most expensive and time-consuming stages in car manufacturing,” Mr Biagi said.
“VR technology allows designers to virtually visualise and interact with a vehicle without the need to build a 1:3 ratio physical model each time a change is required.”
He said the technology has the potential to significantly reduce project cost and lead time while improving global teamwork.
Vehicle modifications can be implemented in real-time by teams collaborating remotely from locations all over the world.
Vection’s technology can also be applied to new car configuration, currently only available to customers as a two-dimensional service.
“It is the perfect solution to visualise all aspects of a car [before ordering], from colour to the smallest component,” Mr Biagi said.
“Providing the client with the possibility to see their new car fully customised to its requirements, under different light conditions and in different environments, provides for a more engrossing sales experience.”
Vection acquisition
ServTech finalised the acquisition of European-based Vection last month, naming it a “highly complementary” addition to its existing operations.
The deal was materially-funded via ServTech shares at a deemed issue price of $0.02 per share with a deferred, performance-based, consideration component based on achievement of Vection’s earnings before interest, tax, depreciation and amortisation (EBITDA) targets.
ServTech said it planned to leverage Vection’s existing tier one client base to generate software development and sale opportunities for the combined group and increase its commercial opportunities.
At midday, shares in ServTech were up 11.76% to $0.019.