The 'UK-CITE' or UK Connected Intelligent Transport Environment project will create the first test route capable of testing next-generation connected and autonomous vehicle technologies.
A fleet of 100 smart tech research vehicles, including Jaguar and Land Rover models, will test new systems that enable cars to communicate with each other, aimed at making driving safer and cutting traffic jams.
The plans by the luxury car brand - that has become UK's largest car maker - include creation of a new "living laboratory" aimed at developing "Connected and Autonomous Vehicle" (CAV) technologies with the help of a new CAV test corridor to evaluate new systems in real-world driving conditions.
Dr Wolfgang Epple, director of research and technology at JLR, said: "This real-life laboratory will allow Jaguar Land Rover's research team and project partners to test new connected and autonomous vehicle technologies on five different types of roads and junctions.
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"Similar research corridors already exist in other parts of Europe so this test route is exactly the sort of innovation infrastructure the UK needs to compete globally.
"The connected and autonomous vehicle features we will be testing will improve road safety, enhance the driving experience, reduce the potential for traffic jams and improve traffic flow. These technologies will also help us meet the increasing customer demand for connected services whilst on the move."
The announcement coincides with the UK government's
support for UK-CITE research with a 3.41 million pounds grant from the country's innovation agency, Innovate UK.
This funding for collaborative research is part of the government's 100 million pound CAV fund.
CAV technologies are aimed at helping traffic authorities monitor and manage traffic flow by capturing data from all connected vehicles and then provide the driver or a driverless car with guidance to optimise the journey.
Technologies like Cooperative Adaptive Cruise Control (CACC) would enable vehicles to autonomously follow each other in close formation, known as platooning, making driving safer and ensuring road space is used more efficiently.
Dr Epple added: "A well-informed driver is a safer driver, while an autonomous vehicle will need to receive information about the driving environment ahead.
The benefits of smarter vehicles communicating with each other and their surroundings include a car sending a warning that it is braking heavily or stopping in a queue of traffic or around a bend. This will enable an autonomous car to take direct action and respond.
"The approach of an emergency vehicle can often be stressful for drivers. If we can inform the driver, or the autonomous car, much earlier that an emergency vehicle is approaching, we can ensure that the best decisions are made to move the vehicle out of the way safely and conveniently, to let the emergency vehicle pass by."
It is hoped that in future, warning messages that are today flashed onto overhead sign boards above a road could be sent directly to the dashboard and repeated if necessary. Besides warning drivers, these would inform future autonomous vehicles, helping them react and respond to hazards and changing traffic conditions automatically.