Ford will install Google's Android operating system on all new vehicles starting in 2023, giving passengers access to more personalized services in their car and potentially unlocking new lines of business for the automaker.
Why it matters: Ford's decision, part of a broader technology partnership with the tech giant, is an acknowledgement that carmakers need Silicon Valley's help to adapt to seismic changes in the transportation industry.
- Embedding the proven Android operating system in their cars lets automakers devote more resources to creating customized in-car experiences while also providing access to familiar Google apps.
- Yes, but: the risk is that automakers lose control over future revenue from in-car data and related businesses.
Flashback: "At the end of the day we don’t want to end up as the handset business," CEO Mark Fields told my Axios colleague Ina Fried in 2015 when she was at Re/code.
Driving the news: To address that risk, Ford and Google are establishing a new group called Team Upshift, comprised of employees from both companies, to focus on innovation.
- The group will aim to "push the boundaries of Ford’s transformation, unlock personalized consumer experiences, and drive disruptive, data-driven opportunities," David McClelland, Ford's vice president of strategy and partnerships, wrote in a blog post.
- Projects could include: modernizing Ford plants through vision AI, or creating new buying experiences and leveraging connected vehicle data.
By the numbers: Gartner predicts that by 2023, in-vehicle transaction payments will total $1 billion, up from less than $100 million in 2020.