Ford Appoints Former Apple Executive to Lead New Digital Services Unit
August 14, 2022
Ford Motor announced on Monday that it has named Peter Stern, a former Apple executive, as the president of its newly formed Ford Integrated Services unit. The move signifies Ford’s commitment to building new high-margin digital and subscription services.
Stern, who previously oversaw Apple TV+, iCloud, and Apple News+, will report directly to Ford CEO Jim Farley. In his new role, Stern will focus on integrating hardware, software, and services across the company’s Ford Blue, Model e, and Ford Pro units.
Like other automakers in the United States, Ford is keen on expanding beyond its traditional wholesale-to-dealer business model. The company aims to build recurring revenues from services connected to its vehicles, following the footsteps of tech giant Apple.
Stern’s addition to Ford’s executive team follows another Apple alumnus, Doug Field, who currently serves as the chief advanced product development and technology officer. General Motors also recently hired a former Apple executive, Michael Abbott, to oversee its software business.
During a media briefing on Monday, Farley highlighted the significance of a new digital vehicle architecture set to launch in 2025 with Ford’s next-generation electric vehicles. The architecture will enable the development of new services for both retail and commercial customers. Farley emphasized that these services will extend beyond electric vehicles and will even be available on Ford’s best-selling pickup truck, the F-150.
Currently, Ford boasts over 550,000 paid software and services subscribers, with more than 80% of them attributed to the Ford Pro commercial unit. This business is generating impressive revenue figures, with “hundreds of millions of dollars” and margins exceeding 50%, according to Farley.
Stern stated that Ford is planning to create “bundles of services” that will provide safer, more convenient, and more productive experiences for customers. He emphasized that the basis for differentiation in the industry is shifting from vehicles alone to the integration of hardware, software, and services.
Stern’s experience at Apple, where he helped grow services like iCloud and Apple Music, will undoubtedly prove valuable in his new role at Ford. He noted that when he joined Apple in 2016, the company’s services had over a billion customer subscriptions.
The appointment of Stern reflects Ford’s commitment to innovation and adaptation in the competitive automotive industry. By leveraging his expertise in digital services, Ford aims to revolutionize the customer experience and drive new sources of revenue.
Reporting by Nathan Gomes in Bengaluru and Paul Lienert in Detroit; Editing by Krishna Chandra Eluri, Sharon Singleton, and Jonathan Oatis