Ford Motor has formed a six-year partnership to use Google’s artificial intelligence, data analytics, and cloud platforms to help with the automaker’s digital transformation and modernization of its operations. Ford shares rose 3.2% in Tuesday’s pre-market session after closing almost 3% higher a day earlier.
As part of the partnership, which will commence in 2023, Ford (F) will deploy Google Cloud as its preferred cloud provider, power future Ford and Lincoln vehicles with the Android operating system and make use of Google apps and other built-in services, including Google Maps, Google Play and voice technology such as Google Assistant.
“As Ford continues the most profound transformation in our history with electrification, connectivity and self-driving, Google and Ford coming together establishes an innovation powerhouse truly able to deliver a superior experience for our customers and modernize our business,” said Ford CEO Jim Farley. “We are obsessed with creating must-have, distinctively Ford products and services. This integration will unleash our teams to innovate for Ford and Lincoln customers while seamlessly providing access to Google’s world-class apps and services.”
In addition, Ford and Google (GOOGL) will set up a collaborative group called Team Upshift, which will include staff and assets of both companies. The new group will work on personalized consumer experiences in retail such as buying a vehicle, and disruptive, data-driven technologies. As a result of the partnership, Ford seeks to accelerate the modernization of its product development and manufacturing and supply chain management. This may include using vision AI for manufacturing employee training.
F shares have soared 25% over the past month, taking their three-month gain to 37%. (See Ford stock analysis).
J.P. Morgan analyst Ryan Brinkman this month lifted the stock’s rating to Buy from Hold with a Street-high $14 price target, citing the “incoming tide of hot new products,” which he expects will “bring substantial volume, mix, and pricing benefits.”
Among the new products, the analyst mentioned is the new Mustang Mach-E all-electric crossover vehicle.
Earlier this month, Deutsche Bank analyst Emmanuel Rosner put the stock on his Catalyst Buy list as he sees room for share gains in the short-term in view of the automaker’s electric-vehicle and autonomous-driving plans. However, for now, Rosner stuck to his Hold rating and $9 price target.
Meanwhile, the rest of the Street is sidelined on the stock with a Hold consensus rating. That’s based on 6 Holds, 4 Buys and 2 Sells. The average analyst price target stands at $10.10, indicating downside potential of about 6.7% from current levels.
EU Sets March Deadline On Microsoft’s $7.5B Deal To Buy ZeniMax
JD Sports To Buy DTLR For $495M In US Push; Shares Spike 7%
Colgate-Palmolive Tops 4Q Estimates Driven By Strong Consumer Demand