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BMW & Daimler to Collaborate for Automated Driving Technology

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BMW AG (BAMXF - Free Report) and Daimler AG intend to partner in order to develop automated driving technology, per Reuters. Around 1,200 developers will work together from both firms on developing new systems.
 
Notably, the alliance aims to develop driver-assistance systems technologies — automated driving on highways and parking. Both German auto giants will implement the automation technologies in their vehicles independently.

BMW and Daimler have finalized the agreement and expect to deploy the new technology in mass-market vehicles from 2024.

Headwinds from international trade conflict and shrinking margins due to emissions legislation have led both carmakers to pool their development resources.

Daimler, for the third time in 12 months, issued a profit warning, stating that it was setting aside hundreds of millions of euros to cover a regulatory crackdown on diesel emissions. In May, BMW issued a profit caution, stating that it made larger-than-expected investments. In fact, the company had issued profit warnings previously.

In February 2019, both companies entered a partnership for the development of self-driving technology. The aim of this partnership is to make autonomous driving technologies mainstream by the middle of the next decade.

Europe's biggest carmaker Volkswagen AG (VWAGY - Free Report) and Ford Motor Company (F - Free Report) are in the final stage discussions on an alliance to develop self-driving and electric cars.

In May, Renault and Italian-American group Fiat Chrysler Automobiles declared that they were in merger talks. However, discussions were later called off.

While Daimler currently has a Zacks Rank #4 (Sell), BMW has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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