CNH Industrial said it has an exclusive, multi-year licensing agreement for electrification technologies with Monarch Tractor which makes fully-electric autonomous tractors.
CNH already owns part of Monarch Tractor based in Silicon Valley, California.
It plans to expand its agriculture business and to spin off its lower-margin truck, bus and engine operations.
"We are confident that the new pathways provided by Monarch will rapidly strengthen our competitive position in sustainable precision farming," chief executive Scott Wine said.
No financial details of the agreement were provided.
The joint venture will initially concentrate on lower-horsepower tractors.
Earlier this year CNH Industrial struck a $2.1 billion deal to buy Raven Industries to bolster its precision agriculture and autonomy operations. CNH markets Case IH, Steyr and New Holland brand farm machinery.
