Paccar andautonomous driving startupAurora have entered into a strategic partnership to develop self-driving trucks.- Paccar's revenue fell significantly in 2020, although the stock managed to gain over 9% on the year.
- The competition in the trucking industry is heating up with new entrants and industry veterans making waves.
Paccar shares were up as much as 3% on Wednesday morning after the semi-truck manufacturer announced a strategic partnership with the Amazon-backed autonomous driving start-up Aurora.
The two companies are looking to combine their respective expertise to develop, test, and sell semi-trucks powered by Aurora's autonomous-driving technology.
"Paccar looks forward to partnering with Aurora because of their industry-leading autonomous driving technology and impressive team," Preston Feight, Paccar's chief executive officer, said in a press release on Tuesday. "This strategic partnership complements Paccar's best-in-class commercial vehicle quality, technology, and innovation."
The Bellevue, Washington-based Paccar is a global leader in the design and manufacture of high-quality light, medium, and heavy-duty trucks. The company also provides its clientele with advanced powertrains, financial services, information technology, and distributes truck parts.
Aurora, meanwhile, has been in the self-driving technology game since 2017 when former Google autonomous-driving engineer Chris Urmson, former Tesla self-driving director Sterling Anderson, and Carnegie Mellon's Drew Bagnell came together to create the company.
Since 2017 Aurora has been making moves in an attempt to create the first fleet of self-driving semis.
In December, Aurora acquired Uber's self-driving unit giving up 26% equity to do so. The company then expanded testing on public roads in California, Pennsylvania, and Texas, focusing on long-haul, commercial trips.
Now, Aurora's technology will be paired with the Peterbilt 579 and the Kenworth T680 semi-trucks at Paccar.
Despite the bullish news, PACCAR and Aurora will face stiff competition going forward, and not just from the big names like Tesla.
Alphabet's Waymo announced plans last year to develop semi-trucks with Daimler, and self-driving startup TuSimple announced it is joining forces with US truck manufacturer Navistar to create driverless big rigs by 2024.
The news of a strategic partnership with Aurora should be cheered by Paccar shareholders. The company's revenue has taken a hit recently, falling some 24% year-over-year in the third quarter, according to its latest SEC filings.
Additionally, Paccar earned just $2.57 per share for the nine months that ended September 30, 2020, versus $5.34 per share during the same period in 2019.
Paccar currently trades around $92 per share and holds a $30 billion market cap.
The company boasts 10 "buy" ratings, 14 "neutral" ratings, and six "sell" ratings from analysts.