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Ford, VW Reach Deal on Global Technology Partnership

Ford Motor Co. and Volkswagen AG have forged a new partnership centered on electric-vehicle and autonomous driving technology that calls for billions of dollars in investments and the introduction of a range of new vehicles.

July 12, 2019
Ford, VW Reach Deal on Global Technology Partnership

Volkswagen AG CEO Dr. Herbert Diess (left) and Ford Motor Co. President and CEO Jim Hackett announced the factories’ new joint technology ventures at a press conference in New York Thursday.

Credit:

Photo courtesy Ford Motor Co.

2 min to read


NEW YORK — Ford Motor Co. and Volkswagen AG announced they are expanding their global alliance to include electric vehicles and will collaborate with Argo AI to introduce autonomous vehicle technology in the U.S. and Europe.

Executives said the move positions both companies to better serve customers while improving their competitiveness and cost and capital efficiencies.

Volkswagen CEO Dr. Herbert Diess, Ford President and CEO Jim Hackett, and Argo AI CEO Bryan Salesky announced Volkswagen is joining Ford in investing in Argo AI, the autonomous vehicle technology platform company. Argo AI’s self-driving system will be independently integrated into purpose-built Ford and VW vehicles.

Ford and Volkswagen will have an equal stake in Argo AI, together owning a “substantial majority,” according to the announcement, with the remainder allocated to an incentive pool for Argo AI employees.

“While Ford and Volkswagen remain independent and fiercely competitive in the marketplace, teaming up and working with Argo AI on this important technology allows us to deliver unmatched capability, scale and geographic reach,” Hackett said. “Unlocking the synergies across a range of areas allows us to showcase the power of our global alliance in this era of smart vehicles for a smart world.”

Company leaders also announced Ford will become the first additional automaker to use Volkswagen’s dedicated electric vehicle architecture and Modular Electric Toolkit to deliver a high-volume zero-emission vehicle in Europe starting in 2023. Ford expects to deliver more than 600,000 European vehicles using the MEB architecture over six years, with a second all-new Ford model for European customers under discussion.

“Looking ahead, even more customers and the environment will benefit from Volkswagen’s industry-leading EV architecture. Our global alliance is beginning to demonstrate even greater promise, and we are continuing to look at other areas on which we might collaborate,” Diess said. “Scaling our MEB drives down development costs for zero-emissions vehicles, allowing for a broader and faster global adoption of electric vehicles. This improves the positions of both companies through greater capital efficiency, further growth and improved competitiveness.”

The alliance, which covers collaborations outside of Volkswagen and Ford’s joint investments in Argo AI, does not entail cross-ownership between the two companies and is independent from the investment into Argo AI. The alliance is governed by a joint committee led by Hackett and Diess and includes senior executives from both companies. Executives said the companies also are on track to deliver medium pickup trucks for global customers, aiming to start in 2022, followed by commercial vans.

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