Ford Motor will install Google's Android operating system on all new vehicles starting in 2023 as part of a six-year partnership with the technology giant.
The deal announced Monday allows Ford to tap into Google's cloud system and utilize its artificial intelligence systems in factories, dealerships and vehicles. The automaker said Google's technology can help spot defects in manufacturing processes, improve supply chain logistics, alert customers when their vehicle needs service or offer trade-in alerts, for example.
The automaker will embed Google's operating system in vehicles for navigation, voice assistant and other services. Ford says customers can continue to use Apple CarPlay, Amazon's Alexa and other operating systems by connecting their own devices.
Terms of the deal were not disclosed, although Ford CEO Jim Farley told CNBC it’s worth “hundreds of millions” of dollars.
Ford shares jumped on the news, rising 4 percent to $10.95 in early afternoon trading.
David McClelland, Ford's vice president of strategy and partnerships, wouldn't say whether the Google operating system would replace the Ford Sync infotainment brand, but said customers would continue to use Sync “until we transition to the Google automotive services solution in calendar year 2023."
Farley told CNBC it was important that Ford “get out of the business of doing generic things that we do not add value, like navigation systems and a lot of the in-car entertainment experience.”
It will be offered on all new vehicles globally in 2023, except for China.
Ford and Google executives said customer data from the system would not be shared with third parties.
"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," Ford CEO Jim Farley said in a statement.
The companies also will establish a collaboration called Team Upshift to develop additional services in the future. McClelland said that could include services related to the commercial autonomous vehicle business that Ford plans to launch in 2022.
McClelland noted Google’s cloud capabilities could help Ford offer customers shopping for new vehicles a more “personalized experience,” but declined to go into details.
The deal comes after Ford’s crosstown rival, General Motors, recently teamed up with Microsoft to offer its cloud computing capabilities to autonomous vehicles from Cruise, which is majority owned by GM.