SHANGHAI (Reuters) -Volkswagen said on Wednesday that CARIZON, its joint venture with China's Horizon Robotics ( HRZRF ), will develop the German carmaker's first in-house chip to power smart driving capabilities in its next generation of cars for China.

The chip will be used for processing data from cameras and sensors in a car with a single-chip computing power of around 500 to 700 tera operations per second (TOPS), Volkswagen said in a statement. It expected to deliver the product within the next three to five years, it added.

Volkswagen said the move would deepen its research and development capability "in China, for China," without elaborating if the chip will be used in cars to be sold outside the world's top auto market. It also did not say how it will arrange the production of the chip.

(Reporting by Zhang Yan and Brenda Goh; Editing by Muralikumar Anantharaman)