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Honda-Waymo in Talks over Self-Driving Auto Technology

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Honda Motor Co., Ltd.’s (HMC - Free Report) R&D arm Honda R&D Co., Ltd. has entered discussions to collaborate with Waymo – an independent company of Alphabet Inc. (GOOG - Free Report) – for the self-driving automobile technology. The companies will be discussing the procedure to incorporate Waymo’s self-driving technology into Honda vehicles. The collaboration will help both the companies to learn about integration of fully self-driving sensors and software in Honda vehicles.

As part of the collaboration, Honda will be providing modified vehicles for Waymo’s self-driving technology. Later, these vehicles will be tested across four cities in the U.S. along with Waymo’s fleet of cars. If the agreement gets finalized, Honda’s R&D engineers in Silicon Valley, California and Tochigi, Japan, will work with Waymo engineers in Mountain View, California and Novi, MI.

Honda expects to start supplying vehicles with automated driving capabilities by 2020 in order to achieve its goal of vehicle collision-free roads. This collaboration will help the automaker in achieving this goal.
 

Price Performance

Honda has underperformed the Zacks categorized Auto Manufacturers-Foreign industry so far this year. The company’s shares have lost 5.98% compared to the industry’s loss of 3.19%. The share price decline can be attributed to frequent recalls, dampened fiscal 2017 revenue guidance, declining sales in Japan and high research and development expenses.



Zacks Rank & Key Picks

Honda currently carries a Zacks Rank #3 (Hold).

Better-ranked companies in the auto space include Allison Transmission Holdings, Inc. (ALSN - Free Report) and Rush Enterprises, Inc. (RUSHA - Free Report) .

All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Allison Transmission has a long-term expected growth rate of 11%.         

Rush Enterprises has a long-term expected growth rate of 15%.

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