Why Ford and Baidu work together now

Here's what we know about it

What companies say

Ford and Baidu announced last week that they had signed a strategic partnership. The agreement involves collaborative efforts in connectivity, artificial intelligence and digital marketing.

But what impact could this have?

It seems that car infotainment systems are the first item on the agenda. The two will jointly develop a new system based on Baidu voice recognition. In summary, the Baidu system will allow Ford to incorporate many new voice commands and other digital services into its cars, as many Chinese customers already know.

Ford and Baidu also explore other ways to collaborate around the world Theme Connectivity in the car explores and targets digital marketing. The intention is to build on the exciting partnership between the two: Ford and Baidu are both invested in Velodyne Lidar, a manufacturer of automotive sensors.

Also, last year, Ford has a self-propelled Baidu car project, the Apollo project

What Ford has pulled

After a few years of decent growth in China, Ford's sales have been collapsed on the largest new car market in the world. The problem: the Chinese car market is fast-paced. Ford's cars, and to some extent their technology, seem outdated.

Ford's turnaround plans, which were unveiled in December, provide some new models for the Chinese market. But also the commitment in the field of connectivity and other mobile services should be strengthened. Thus, not only will new models be available for Chinese dealers, but they should also be equipped with advanced technology to attract more Chinese customers.

The collaboration with Baidu on digital extras, adapted to the Chinese market, seems to be in place to be a logical step. But Ford may also have a long-term reason to cooperate closely with Baidu: autonomous cars

Just like its American competitor Alphabet Baidu has also developed its own technologies for autonomous cars. But, as with Alphabet, it seems unlikely that the Chinese themselves enter car production. Ford could therefore hope to get a share of Baidu's autonomous fleet.

Peter Fleet, Ford Asia-Pacific boss:

Collaborating with leading technology companies like Baidu helps us realize our vision. in which we create new sustainable ecosystems for mobility. As part of our strategy in China, for China we look forward to the close cooperation and intelligent products and solutions that we can offer our customers and that will make their lives easier.

Baidu a

Baidu, like Google, is very interested in collecting data. In this regard, it is clear and obvious to cooperate with Ford and to be represented in its vehicles. That sounds like that, so Baidu is also thinking of who could build their fleet of autonomous cars.

Baidu and Ford share the vision of the use of technology to create the mobility of the future, said Baidu CEO. Thanks to Baidu's advanced artificial intelligence and Ford's ten-year experience in automotive manufacturing, we will transform mobility and create the next generation of driving experience for our customers [19659003] A good Ford train in China

Ford would like to launch its own connectivity and infotainment program in China because it is likely to be planned for the US market. The same applies to autonomous driving. But Ford is just not big enough in China to be able to do it alone

He needs a partner – and Baidu could prove to be an excellent partner.

The risk is that Ford only "stupid cars" in which Baidu operates its software for autonomous cars. But realistically, there are few alternatives for Ford in China. So, considering that, it would also be very good.

And since Ford is probably one of the largest vehicle suppliers in the fleet, this could also be a smart move for Baidu!

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John Rosevear owns shares in Ford, The Motley Fool recommends Ford, The Motley Fool owns and recommends Baidu.

This article was written in English by John Rosevear and was published on Fool.com on June 28, 2018. It has been translated so that our German readers can participate in the discussion.