Ford Motor Company has chosen IBM
and
Dassault Systemes SA to provide software and
consulting service in the automaker’s bid to integrate its computer design
and manufacturing processes around the world.
The contract victory is a major win for IBM and Dassault, which won the deal
away from outsourcing rival, Electronic Data Systems . EDS
has been the major systems integrator for Ford, and will continue to work
with the automaker.
While the specific value of the contract is not known, it is expected to
generate hundreds of millions of dollars for IBM in systems integration
services and consulting.
The contract victory also solidifies Dassault as a leader in the automotive
software design market. Arc Advisory Group estimates that Dassault has
close to 50 percent market share of product life cycle management software
market for the auto industry. IBM is working closely with Dassault on the
marketing of its Catia and Enovia software products for the auto industry.
The Ford deal isn’t the first major contract win for IBM-Dassault, just last
year the tandem won a deal worth close to $800 million with Toyota Motor
Corp. IBM-Dassault now have contracts with 22 of the top 30 leading
automakers around the globe.
As part of the deal, Ford is expected to purchase more than 4,000 copies of
the IBM-Dassault software that will be utilized by computer designers. And
for IBM for each piece of software sold, it often brings in nearly five
times in ensuing consulting fees.
Ford, the second largest U.S. automaker behind General Motors (and former
parent of EDS) is aiming to improve efficiency to boost profits in coming
years in its drive to overtake GM. One way it sees of achieving this goal is
through shortening design cycles through software innovation.
There is a fierce battle being fought among the automakers in the fields of
computer modeling not only of new cars, but the ways these gigantic global
auto making manufacturers can utilize the most innovate software
technologies to gain the edge on its competitors.