Nokia launches $100m smart car fund Published duration 5 May 2014

image copyright Nokia image caption Nokia has said mapping service is one of the three key business it will focus on

Nokia has launched a $100m (£59m) fund which will invest in firms specialising in connected and smart vehicles.

It is seen as a key growth area and Nokia has established its presence in the sector with its mapping service Here for connected vehicles.

The move comes just days after Nokia completed the sale of its handset unit to Microsoft.

The Finnish firm has said that mapping services is one of the three key businesses that it plans to focus on.

Nokia said the fund, which will be managed by Nokia Growth Partners (NGP), will support the growth of the sector.

'Surge in innovation'

Firms have been looking to connect vehicles - not only to the internet, but also to each other.

The idea is that connected and "smart" vehicles would not only change the way drivers use their cars, but also make them more safe by sensing nearby vehicles.

A key part of that connectivity is the ability of vehicles to access their location, and that of other objects around them.

And as an increasing number of vehicles become inter-connected, it could provide a growth opportunity for firms specialising in the sector.

"For the last few years there has been a surge in innovation that has brought technological advances leading to safer, cleaner, increasingly connected, intelligent and more affordable vehicles," Paul Asel, partner at NGP, said in a statement

"Vehicles are becoming a new platform for technology adoption very similar to phones or tablet."

Other players

Other firms have also been keen to tap into the sector, including Google, Apple and Intel.

image copyright AFP/Getty Images image caption Apple is among the tech companies eyeing the smart car market

Earlier this year, Google announced that it is teaming up with several car manufacturers - including Audi, Honda and Hyundai - to integrate its Android operating system into their dashboards.

That would allow the apps and music on Android smartphones and tablets to work better with onboard car systems.

Google has also added a traffic layer to Google Maps, sourced from other Android users, to inform users about traffic jams and other road issues.

Rival Apple has also unveiled its CarPlay iPhone system which allows iPhones to plug into cars.

The firm said that would allow drivers to call up maps, make calls and request music with voice commands or a touch on a vehicle's dashboard screen.

Chipmaker Intel has also previously announced a $100m fund dedicated to investing in technology aimed at accelerating the development of internet-connected cars.