The US carmaker said it will invest $1bn (£800m) over the next five years in Argo AI, an AI software and robotics technology startup, to support its autonomous vehicle development.
Pittsburgh-based Argo AI, which was founded by former Google and Uber leaders, will work to develop a new software platform for Ford, strengthening its self-driving offering, Ford said in an announcement late last night.
Ford's investment will make it the tech firm's largest shareholder.
The new virtual driver system will be put into Ford's fully autonomous vehicle that's set to come by 2021 - and the carmaker hopes to license the technology out to other companies.
Ford president and chief executive Mark Fields likened the impact of the automation of cars on society to that of Ford's original assembly line 100 years ago.
He added: "As Ford expands to be an auto and a mobility company, we believe that investing in Argo AI will create significant value for our shareholders by strengthening Ford’s leadership in bringing self-driving vehicles to market in the near term and by creating technology that could be licensed to others in the future."
Argo AI chief executive Bryan Salesky said: "We are energised by Ford’s commitment and vision for the future of mobility, and we believe this partnership will enable self-driving cars to be commercialised and deployed at scale to extend affordable mobility to all."