Swedish telecom gear maker Ericsson has teamed up with Microsoft to build the next generation of connected cars.

Ericsson is building its Connected Vehicle Cloud on top of the Microsoft Connected Vehicle Platform that is running on the Azure Cloud platform.

The integrated solution allows automakers to deploy and scale global vehicle services such as fleet management, over-the-air software updates and connected safety services much easier and faster while reducing costs, the company said in a statement on Thursday.

Ericsson's Connected Vehicle Cloud connects more than 4 million vehicles across 180 countries worldwide - approximately 10 per cent of the connected vehicle market.

"Our integrated solutions will help automotive manufacturers accelerate their global connected vehicle solutions and offer a better experience for drivers and passengers," said Asa Tamsons, Senior Vice President and Head of Business Area Technologies & New Businesses at Ericsson.

The Microsoft Connected Vehicle Platform (MCVP) empowers automotive companies to accelerate the delivery of safe, comfortable and personalized connected driving experiences.

It combines cloud infrastructure, edge technology as well as AI and IoT services with a diverse partner ecosystem.

"Together with Ericsson, we intend to simplify the development of connected vehicle services to help car makers focus on their customers' needs and accelerate the delivery of unique, tailor-made driving experiences," said Peggy Johnson, Executive Vice President, Business Development at Microsoft.

Connected vehicle Cloud as-a-Service will reduce complexity, enable innovation and simplify the application development in the automotive industry.