In a race to gain a foothold in autonomous driving technology, Samsung Electronics, South Korea’s leading smartphone maker, has formed a fund worth $300 million to step up development in the self-driving industry.

“The $300 million Samsung Automotive Innovation Fund will focus on securing autonomous driving and connected car technologies,” the tech giant said through a press release.

Self-driving and connected car technologies include: smart sensors, machine vision, artificial intelligence, and connectivity solutions.

Managed by the Samsung Strategy and Innovation Center, which is in charge of the company’s long-term research and development operation in the US, the fund will be used for Samsung to cooperate with companies and startups in autonomous driving and connected car technologies.

“The creation and investment of the Fund will have a positive impact on Samsung Electronics’ share price,” said Claire Kim and John Park, analysts of Daishin Securities covering Samsung Electronics.

“It will also help remove the market concern that the absence of Vice Chairman Lee Jae-yong could hinder the company’s long-term M&As and investments.”

The fund’s first strategic investment of 75 million euros will be made into Austrian tech firm TTTech, a leader in functional safety, deterministic networking, real-time systems, and complex software integration for ADAS and automated driving platforms, Samsung said.

Prior to Samsung’s latest investment, the company has also invested in automotive startups: AImotive and Renovo for self-driving; Quanergy, TetraVue, and Oculii for sensors; Autotalks and Valens for connectivity; and Graphcore for high-performance computing.

Samsung Electronics stepped into the automotive technology industry in late 2015 by establishing a team dedicated to auto parts for infotainment systems and self-driving vehicles.

In March this year, the company acquired US auto parts supplier Harman for $8 billion, the largest merger in Korea’s history.

Samsung also said Harman established a Strategic Business Unit under the connected car division to be in charge of automated driving as well as advanced driving assistant systems.

Together with the Samsung Strategy and Innovation Center, the new unit is expected to focus on developing key technologies for safer and more advanced connected cars, the company said.

Samsung Electronics obtained permission to test drive automated cars in May this year in Korea, followed by approval by the state of California last month.

Regarding speculations that Samsung may re-enter the carmaking industry it left 17 years ago, the company said it would stick to supplying software and sensors to self-driving carmakers. 

By Kim Bo-gyung (lisakim425@heraldcorp.com)