Swedish carmaker Volvo Cars said on Monday it has signed an agreement to provide cars to the autonomous driving technology unit of China's top ride-hailing firm, Didi Chuxing, for its self-driving test fleet.

Volvo will provide XC90 SUVs equipped with backup steering and braking systems that DiDi Autonomous Driving will integrate with Didi Gemini, its new self-driving hardware platform.

Didi is currently working toward an initial public offering with a valuation of at least $100 billion.

Just last week self-driving startup Cruise, which is backed by General Motors, said it had raised $2.75 billion in its latest funding round from investors including Walmart, taking its valuation to over $30 billion.

Volvo Cars, which is owned by China's Zhejiang Geely Holding Group, will initially provide Didi with hundreds of vehicles, with the aim of adding more as the self-driving test fleet expands, head of strategy Alexander Petrofski told Reuters.

"For us, this is a tremendous opportunity because we gain real-world know-how and get to test our vehicles in a real-world environment," Petrofski said. "This is something we will benefit from when we start rolling out this technology in applications for our customers."

Petrofski said a few of the vehicles have already been delivered to Didi.

Volvo began providing test cars to Uber's autonomous driving unit back in 2016. Uber Technologies sold that business to self-driving car startup Aurora last year and is still using Volvo vehicles.

"This (new agreement with Didi) is in line with our vision to be the partner of choice on a global level" for self-driving fleets, said Volvo's head of autonomous driving strategy, Johan Taws.

The built-in backup systems and safety features on Volvo's XC90 cars, combined with Didi's self-driving system, will eventually allow the cars to operate without safety drivers in robotaxi services, Volvo said.