Volkswagen Group and Ford Motor Company have announced plans to expand their existing partnership beyond light-commercial vehicles (LCVs), expanding into electric vehicle (EV) architecture and self-driving technology.
The new agreement will see Ford become the first car maker outside VW Group to have access to the Modular Electric Toolkit (MEB) platform set to underpin the upcoming ID family of all-electric Volkswagen models.
Ford will use the MEB platform to create a full-electric vehicle for sale in Europe. It plans sell 600,000 units over six years, starting from its release in 2023.
There is also the possibility of a second model destined solely for Europe, which would be in addition to the already-announced Mustang-inspired crossover EV.
Volkswagen Group CEO Herbert Diess said the MEB sharing would reduce development costs for EVs, which can in turn stimulate the sale of alternative-propulsion vehicles.
“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,” he 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.”
VW Group has plans to build around 15 million MEB-based vehicles, following a $US7 billion ($A10b) investment.
Along with the MEB plans, the two automotive giants have also announced an investment in autonomous-driving start-up Argo AI, which is in the process of developing a Level 4 self-driving system with plans to deploy it in Europe and the US.
With the combined investment totalling over $US7 billion, the deal sees VW and Ford gain equal individual stakes in the start-up, which when put together make up a majority stake in the company.
VW’s initial $US2.6 billion ($A3.7b) investment includes of funding and its $US1.6 billion ($A2.3b) Autonomous Intelligent Driving (AID) company, which has 200-plus employees that will be used to aid Argo AI’s 500-strong global workforce.
The deal will also see VW purchase $US500 million of Argo AI shares from Ford over three years.
Ford Motor Company president and CEO Jim Hackett said the joint AI investment would be beneficial to both companies.
“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,” he 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.”
The alliance between the two companies was first announced in January, including plans to co-develop the next-generation Ranger and Amarok pick-ups.
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