Ford and VW join on EV and AV projects

Ford and Volkswagen will collaborate on EVs and autonomous vehicles (AVs) under a new agreement expanding their global alliance.

It will lead to a highly differentiated Ford EV for Europe by 2023, built on VW’s Modular Electric Drive (MEB) toolkit, expanding on Ford’s zero-emission capabilities in the region and possibly producing more than 600,000 units.

Ford’s new European vehicle will be designed and engineered by Ford in Cologne-Merkenich, adding another nameplate to its all-electric Mustang Mach-E which will be introduced in 2021.

With VW’s recent investment in Argo AI, Ford and VW will also work with Argo AI to independently develop AVs at scale based on Argo AI’s innovative self-driving technology.

Ford chief operating officer Jim Farley says Ford will add battery electric versions of the Transit and F-150 in the next two years for commercial customers who increasingly need zero emissions and the power of connectivity, data and artificial intelligence.

Its use of VW’s MEB architecture in Europe will represent another cornerstone in VW’s electric vehicle strategy, and further efforts by both companies to fulfill their commitments to the Paris 2015 Agreement. Volkswagen and Ford plan to explore additional ways to cooperate on EVs.

The relationship does not include cross-ownership between the companies, which will remain competitors in the marketplace, but it is expected to create significant efficiencies.

The deal is geared to meeting rapidly evolving needs of their respective customers in Europe and other regions by leveraging complementary strengths in midsize utes and commercial and electric vehicles.

The companies expect the alliance to enhance ownership experiences for current and future customers by more rapidly innovating vehicle offerings, incorporating relevant new technologies, delivering better utility and offering more model choices.

They anticipate continued growth in global industry demand for commercial vehicles and for high-performing EVs to add valuable scale to their individual product portfolios.

“In light of the COVID-19 pandemic and its impacts on the global economy, more than ever it is vital to set up resilient alliances between strong companies,” VW Group chief executive Dr Herbert Diess says.

“This collaboration will efficiently drive down development costs, allowing broader global distribution of electric and commercial vehicles, and enhance the positions of both companies.”

Ford chief executive Jim Hackett says the alliance comes at a time of tremendous enthusiasm about the intersection of increasingly intelligent, connected vehicles.

“This creates a huge opportunity to innovate and solve many of the world’s transportation challenges and deliver extraordinary benefits to customers – even as companies need to be selective about how they use their cash.”

Ford and VW have strong commercial van and ute businesses around the world, including popular models such as Ford’s Transit (with a plug-in hybrid version due shortly) and Ranger and Volkswagen Commercial Vehicle’s Transporter, Crafter, Caddy and Amarok.

The companies will both work with Argo AI to form distinct, highly capable AV businesses based on Argo AI’s self-driving technology. VW recently closed its previously announced investment in Argo AI, the Pittsburgh-based company in which Ford already had ownership and development interests.

Argo AI’s SDS is the first with commercial deployment plans for both Europe and the US.