Microsoft partners with Volvo to explore augmented reality applications in car buying and more
Virtual car shopping on a HoloLens? Volvo says it's coming next year thanks to Microsoft partnership … Volvo says I saw the future of car dealerships earlier today.
Context & Ripple Effects
The January reveal of HoloLens left Microsoft with a headset in search of non-gaming proof points, and by March it was testing Xbox titles on the device. The Volvo partnership is the first named retail application: a major automaker agreeing to prototype augmented-reality car shopping, with Volvo saying it plans to show something next year.
It also matters as a signal to Microsoft's hardware ambitions — six months later it would open the underlying platform to outside device makers in the Windows Holographic program with Intel, AMD, HTC, and Acer — and to Volvo's own trajectory, which later runs from this experiment to a 2019 investment in VR startup Varjo for mixed-reality engineering work.
First-order effects
- Volvo gains a differentiated showroom pitch — prospective buyers could configure or experience cars via HoloLens rather than only physical displays — while Microsoft gets its first marquee automotive retail customer at exactly the moment it needs uses beyond games.
Second-order effects
- A working Volvo deployment gives Microsoft's Windows Holographic partner push (Intel, AMD, HTC, Acer building AR/VR hardware) a concrete enterprise use case to market against, pressuring rivals like HTC to court similar anchor customers in retail.
Third-order effects
- If the pattern holds — Volvo moving from a HoloLens shopping demo to funding Varjo headsets used by its own engineers — automakers shift from treating XR as a marketing stunt to core infrastructure for both sales and design, weakening the physical dealership's role as the primary point of product contact.
The trend: Automakers are moving from physical showrooms toward mixed reality for retail and engineering alike, and headset makers are competing to sign them as anchor enterprise customers.