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McDonald’s has entered into a strategic alliance with IBM to develop AI technology to automate drive-thru lanes. As part of the deal, IBM will acquire McD Tech Labs, a company focused on technology development at McDonald’s.
McDonald’s acquired Dynamic Yield, a machine learning startup, and Apprente, a startup developing voice recognition AI, in 2019 to improve drive-thru efficiency. While Dynamic Yield survived as an independent company under McDonald’s, Appren was completely absorbed by McDonald’s. Appren employees became part of an integrated team called Mactech Lab, which was newly established within McDonald’s. Appren technology, which AI recognizes drive-thru orders, was tested in several cities in the United States in June 2021, and the accuracy was 85%. The implementation of the technology is expected to take about two years, so 80% of all orders can be processed by AI.
This time, McDonald’s and IBM formed a partnership, and MacTech Lab was acquired by IBM. Details of the contract or financial terms were not disclosed. McDonald’s CEO Chris Kempchinski said that IBM is an AI-driven customer care solution and voice recognition expert and an ideal partner for McDonald’s.
IBM also said in a statement that McDonald’s is committed to digital, delivery and drive-thru innovations as part of its Strategic Growth Plan (Accelerating the Arches).
The acquisition is expected to close in December 2021. McDonald’s shares rose more than 2% on the afternoon of the 27th (local time) when McDonald’s announced its third-quarter earnings and partnership with IBM. Related information can be found here.
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