Alphabet Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) is attracting major automakers in the United States with Google’s self-driving car technology. Automakers are now taking steps to produce the next generation of vehicles.
Earlier this year, Google co-founder Sergey Brin stated that they are looking for manufacturing partners to use the company’s self-driving technology.
Ford in talks to form a joint venture with Google
A report from Bloomberg indicated that Food Motor Company (NYSE:F), General Motors Company (NYSE:GM) and Fiat Chrysler Automobiles (NYSE:FCA) are interested with Google’s self-driving technology.
Yesterday, it was reported that Ford is in talks with Google to form a joint venture to build self-driving cars using the tech giant’s technology. Sources familiar with the matter said Ford is expected to announce the partnership during the Electronics Show in January.
Ford has been developing self-driving software and conducting experiments for years. The automaker recently announced its intention to begin testing its software on public streets in California and Texas.
Market observers suggested that a partnership with Google will boost Ford’s efforts in building self-driving cars. Currently, the tech giant has 53 self-driving test vehicles running on the roads of California and Texas.
On the other hand, a partnership with Ford will also provide an advantage for Google because it will avoid spending several years and billions of dollars to build its own automotive manufacturing, which requires expertise.
In October, Mark Reuss, chief of product development at General Motors expressed that they are “very interested” exploring ways to complement the company’s manufacturing skills with Google’s self-driving system.
Sergio Machionne, CEO of Fiat Chrysler Automobiles also stated over the past few months that his company wants to work with technology companies such as Apple and Google in building autonomous driving vehicles.
Alphabet to make self-driving unit a stand-alone business
Alphabet decided to make the self-driving car unit as a stand-alone business under its umbrella next year. In September, Google X hired John Krafcik, a veteran in the auto industry, to serve as CEO of its cars project.
In an e-mail to Bloomberg, Google spokesman Johnny Lou, said, “In order to reach our long-term goal of transforming mobility for millions of people we’re talking to many different companies about how to bring self-driving vehicles into the world safely, but we’re not going to comment on rumor or speculation about specific conversations.”
One of the main objectives of Google in developing self-driving cars is to reduce accidents, which claim approximately 33,000 lives every year in the United States.
Thiol Kieslowski, vice president of automotive practice at Gartner, said, “We are entering the era of technology and software-define vehicle. According to him, the auto industry now recognizes the importance of that [self-driving technology].
Kieslowski added that the automakers are reaching out to Google because they believe that its technology will add brains to their vehicles. They prefer a partnership, which is mutually beneficial instead of developing a rival system.
“Some Silicon Valley companies would like to do everything themselves, but it’s really the car companies that understand the automobile. On the same side, a lot of technology companies have expertise on their side, which is interesting to the automotive companies,” said Kieslowski.