In looking for cutting edge automotive technologies, automakers will have to adopt a different attitude towards start-ups

Ford and Magna, in collaboration with a number of other companies, have announced a new programme to foster innovative transportation-related start-ups in Detroit. The partners have committed USD2 million for the programme, along with mentors and other resources to support participating start-ups.

As part of the programme, 10 start-up companies will be selected from across the United States to move to Detroit and take part in a three-month evaluation. Each of the 10 companies will receive USD120,000 in funding, intensive training and mentoring in business development, and help with customer acquisition and effective executive recruiting. The programme is set to run over a three-year period, with a total of 30 participating start-up companies.

The scheme is a different way for both suppliers and OEMS to look at new technologies that they might otherwise have missed. As global tier ones grow larger, with balance sheets comparative to automakers, a number are increasingly look at making acquisitions in a similar in style to those seen in Silicon Valley. California has seen an explosion in the number of small start-ups that have developed a unique product, sometimes with only a single use and a small team of employees, that are quickly picked up by the hugely diversified major industry players looking for the latest new tech. It would not be surprising to see a successful start-up from this scheme acquired by either Ford or Magna at some point in the future.

The scheme will also be part of a larger strategy as suppliers fight in an increasingly fierce battle to maintain a competitive R&D edge, not only over other suppliers but also their OEM customers, who have ceded a great deal of ground on the technology front to suppliers over the last few years.

The initiative will focus on creating a hub for transportation and mobility innovations in Detroit, and supporting companies working on innovative ideas to better facilitate the transportation of people, goods, and services, by solving the challenges involved in daily commutes such as traffic and parking. The incubator’s goal is to bring to market new technologies and approaches that incorporate mobile devices, wireless connectivity and cloud computing to make driving a safer and more enjoyable experience for people. The scheme is focused on the Detroit area, but the parameters mentioned above suggest that any successful could be applied across North America and potentially on a global basis

The programme is expected to give participating companies exposure to new ideas much more quickly than having to wait for full development, as well as the opportunity to get involved and respond quickly to the most promising developments. Moreover, the programme is a comparatively inexpensive way to help foster technology development across the industry and provide access to unique solutions that might not be generated out of the more traditional companies.

Contacts

Copyright © 2025 S&P Global Inc. All rights reserved.

These materials, including any software, data, processing technology, index data, ratings, credit-related analysis, research, model, software or other application or output described herein, or any part thereof (collectively the “Property”) constitute the proprietary and confidential information of S&P Global Inc its affiliates (each and together “S&P Global”) and/or its third party provider licensors. S&P Global on behalf of itself and its third-party licensors reserves all rights in and to the Property. These materials have been prepared solely for information purposes based upon information generally available to the public and from sources believed to be reliable.
Any copying, reproduction, reverse-engineering, modification, distribution, transmission or disclosure of the Property, in any form or by any means, is strictly prohibited without the prior written consent of S&P Global. The Property shall not be used for any unauthorized or unlawful purposes. S&P Global’s opinions, statements, estimates, projections, quotes and credit-related and other analyses are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security, and there is no obligation on S&P Global to update the foregoing or any other element of the Property. S&P Global may provide index data. Direct investment in an index is not possible. Exposure to an asset class represented by an index is available through investable instruments based on that index. The Property and its composition and content are subject to change without notice.

THE PROPERTY IS PROVIDED ON AN “AS IS” BASIS. NEITHER S&P GLOBAL NOR ANY THIRD PARTY PROVIDERS (TOGETHER, “S&P GLOBAL PARTIES”) MAKE ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE PROPERTY’S FUNCTIONING WILL BE UNINTERRUPTED OR THAT THE PROPERTY WILL OPERATE IN ANY SOFTWARE OR HARDWARE CONFIGURATION, NOR ANY WARRANTIES, EXPRESS OR IMPLIED, AS TO ITS ACCURACY, AVAILABILITY, COMPLETENESS OR TIMELINESS, OR TO THE RESULTS TO BE OBTAINED FROM THE USE OF THE PROPERTY. S&P GLOBAL PARTIES SHALL NOT IN ANY WAY BE LIABLE TO ANY RECIPIENT FOR ANY INACCURACIES, ERRORS OR OMISSIONS REGARDLESS OF THE CAUSE. Without limiting the foregoing, S&P Global Parties shall have no liability whatsoever to any recipient, whether in contract, in tort (including negligence), under warranty, under statute or otherwise, in respect of any loss or damage suffered by any recipient as a result of or in connection with the Property, or any course of action determined, by it or any third party, whether or not based on or relating to the Property. In no event shall S&P Global be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees or losses (including without limitation lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Property even if advised of the possibility of such damages. The Property should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions.

The S&P Global logo is a registered trademark of S&P Global, and the trademarks of S&P Global used within this document or materials are protected by international laws. Any other names may be trademarks of their respective owners.

The inclusion of a link to an external website by S&P Global should not be understood to be an endorsement of that website or the website's owners (or their products/services). S&P Global is not responsible for either the content or output of external websites. S&P Global keeps certain activities of its divisions separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain divisions of S&P Global may have information that is not available to other S&P Global divisions. S&P Global has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process. S&P Global may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P Global reserves the right to disseminate its opinions and analyses. S&P Global Ratings’ public ratings and analyses are made available on its sites, www.spglobal.com/ratings (free of charge) and www.capitaliq.com (subscription), and may be distributed through other means, including via S&P Global publications and third party redistributors.