Ford and Volkswagen have agreed to “investigate collaboration” on autonomous vehicles, mobility services and electric vehicles as part of a sweeping new partnership announced today, with the two already starting to “explore opportunities”.
(Ford has previously said it hopes to have fully autonomous vehicle in commercial operation by 2021. VW has set a similar target: Chief Digital Officer Johann Jungwirth has moved to San Francisco, California, to establish the operation.)
The news comes as the American and European automotive heavyweights announced the first formal agreements in a broad alliance that they hope will boost competitiveness amid increasing market headwinds globally.
First up: plans to co-develop commercial vans and medium-sized pickups for global markets beginning as early as 2022. (The two said the agreement will yield improved annual pre-tax operating results starting in 2023.)
That news comes a day after VW said it is investing €700 million in an electric car plant in the US’s Chattanooga, with the first EV set to roll of its production line as early as 2022. These will be based on its modular electric toolkit “MEB”: a platform at the heart of Volkswagon’s aggressive push into electric vehicles.
Volkswagen CEO Dr Herbert Diess and Ford CEO Jim Hackett made the news in a joint announcement on Tuesday.
“Over time, this alliance will help both companies create value and meet the needs of our customers and society,” Hackett said.
“It will not only drive significant efficiencies and help both companies improve their fitness, but also gives us the opportunity to collaborate on shaping the next era of mobility.”
“The alliance will be a cornerstone for our drive to improve competitiveness,” Diess added.
The alliance, which does not entail cross-ownership between the two companies, will be governed by a joint committee. This committee will be led by Hackett and Diess and will include senior executives from both companies.
Ford Volkswagen Deal Follows VW’s Microsoft Partnership
It is the latest in a series of large-scale partnerships inked by VW. As Computer Business Review reported in September 2018, the company has agreed a five-year deal with Microsoft that will see all it will build all in-car services for its brand on Microsoft technology alone, with infotainment powered by Azure.
The Ford Volkswagen collaboration comes as global car makers were hit hard in markets by a slowdown in China, with Chinese passenger vehicle sales falling in 2018 for the first time since 1990. With markets facing saturation and EVs of rising popularity, many manufacturers had banked on China to sustain growth.