Ford Hires Former Apple Executive to Lead Software Subscription Services Unit
Ford Motor Company has made a significant move by hiring Peter Stern, a former Apple executive, to head a new business unit focused on selling software-related subscription services to vehicle owners. This latest development reflects Ford’s commitment to expanding its offerings beyond traditional auto manufacturing and into the software and services industry. Stern will assume the role of president of Ford Integrated Services, a unit that aims to combine software and hardware into a range of innovative services.
Prior to joining Ford, Stern served as Apple’s vice president of services, where he oversaw various businesses, including Apple TV Plus, iCloud storage, Apple Books, and fitness operations. At Ford, Stern will be responsible for expanding the BlueCruise hands-free partially automated driving system, as well as productivity, safety, and security services.
According to Stern, the key to success in the subscription services market lies in delivering value to customers. He believes that as long as customers perceive the value, they will continue to purchase individual services and bundles. Stern plans to create service bundles that make it easier for customers to maximize the benefits of their vehicles.
During his time at Apple, Stern witnessed the rapid growth of subscription services, with the company’s subscription base reaching over 1 billion users by the time he left. Stern expressed confidence in Ford’s ability to replicate this success, noting that the company has a solid understanding of the playbook and has several exciting service ideas in mind.
Stern also highlighted the potential for safety and security services to attract a high number of subscribers. Ford recently showcased a feature in which an SUV recognized a bear at a campsite and activated the horn and lights to scare it away. This type of innovative safety feature could be a major selling point for customers.
While Ford currently has 550,000 paid subscribers for software services, CEO Jim Farley emphasized that the company does not have immediate plans to separate the Integrated Services unit as a separate business or disclose its profits on the income statement. However, this may change in the future.
Looking ahead, Ford plans to introduce a new vehicle electrical system in 2025, which will enable the rollout of more advanced software services. This system will be incorporated into both electric and combustion-engine vehicles, such as the upcoming version of the F-150 pickup.
Ford’s decision to hire an executive with expertise in subscription services is indicative of its strategic focus on diversifying its revenue streams and exploring new business opportunities. With the automotive industry increasingly shifting toward software and services, this move positions Ford to compete in this rapidly evolving market.
In conclusion, Ford’s hiring of Peter Stern demonstrates the company’s commitment to expanding its software and services offerings. With his experience at Apple and Time Warner Cable, Stern brings valuable expertise in developing and scaling subscription-based businesses. Ford’s focus on delivering value to customers and its plans to enhance safety and security services suggest a promising future for the company in the software subscription market.
Key Takeaways:
- Ford has hired former Apple executive Peter Stern to lead a new business unit focused on selling software-related subscription services to vehicle owners.
- Stern will expand Ford’s BlueCruise hands-free partially automated driving system and develop productivity, safety, and security services.
- Ford believes that delivering value to customers is crucial for the success of subscription services.
- The company plans to introduce a new vehicle electrical system in 2025 to enable advanced software services.
- Ford’s strategic move reflects its commitment to diversifying revenue streams and competing in the software and services industry.
