Volkswagen and Ford will jointly develop vans and pickups, and later, autonomous and electric vehicles under a wide-ranging alliance which will help both firms share resources and shave costs.
As early as 2022, both firms intend to develop commercial vans and medium-sized pickups for global markets, which is hoped will yield “improved annual pre-tax operating results” beginning in 2023.
VW and Ford have also begun to explore opportunities for collaboration on autonomous and electric vehicles, as well as mobility services with the signing of a memorandum of understanding (MOU).
The alliance will drive “significant scale and efficiencies” and enable the duo to jointly invest in vehicle architectures, VW and Ford said in a joint statement.
What does the partnership hope to achieve?
The partnership will be governed by a joint committee headed by the VW and Ford chief executives and does not entail cross-ownership between the firms.
“Over time, this alliance will help both companies create value and meet the needs of our customers and society,” Ford chief executive Jim 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,” Mr Hackett added.
Volkswagen AG CEO Herbert Diess said: “Volkswagen and Ford will harness our collective resources, innovation capabilities and complementary market positions to even better serve millions of customers around the world.
“At the same time, the alliance will be a cornerstone for our drive to improve competitiveness.”
What models will be shared?
The Ford Transit and Volkswagen Transporter, Caddy and Amarok models will be made available to each company.
Ford will engineer and build medium-sized pickups for both companies, which are expected to go on sale as early as 2022.
In total, light commercial vehicle volumes in 2018 totalled some 1.2 million units globally, and demand for both medium pickups and commercial vans is expected to grow globally over the next half-decade.
Ford Motor Company has been in a pickle recently.
According to Bloomberg, the company announced it will cut thousands of jobs, weed out slow-selling models and potentially close factories in Europe in a US$11-billion global cost-cutting drive.