The move follows recently established links to Silicon Valley and Uber.

Volvo has started a new fund to investing in high-potential technology startups all over the world.

The fund will invest in strategic technology that are emerging in the automotive industry like artificial intelligence, electrification, autonomous driving and digital mobility services. Volvo's first move is to invest into a Silicon Valley company in the US

The Swedish carmaker says that companies it invests in will get the ability to validate their technologies and accelerate the pace of product development too, as well as gaining access to Volvo's worldwide network of partners and markets, including the increasingly lucrative Chinese market.

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'We seek to invest in companies that can provide us with strategic access to new technologies, capabilities and talent,' said Zaki Fasihuddin, who is currently Vice President of Strategic Partnerships in the Volvo Cars Silicon Valley Technology Center, and has been appointed CEO of the Volvo Cars Tech Fund.

'By supporting promising young firms at the forefront of technological development and providing them with both capital and strategic value, we aim to strengthen our leading role in the industry’s technological transformation,' he said.

Volvo's head of research, Mats Moberg, added: 'We work closely with promising technologies, and when we see value creation potential for us as a user, we can now also invest to help accelerate the venture.'

The launch of the Volvo Cars Tech Fund is the latest move from Volvo to modernise and develop into a technological leader in the coming years.

As well as its recently established links with Silicon Valley, the Swedish carmaker also acquired the assets and key personnel of Luxe, a US-based premium valet and concierge service, last year in a bid to improve its digital services. It is also working alongside Uber to develop autonomous car technology.

Gallery: Volvo-Google Technology Partnership