Tuesday, 23 July, 2019

Ford, Volkswagen join forces on electric, autonomous cars

Argo AI modified Ford Motor Co. Fusion autonomous vehicle sit parked in a garage at the company's headquarters in Pittsburgh Pennsylvania U.S. on Thursday Aug. 16 2018 News Ford, Volkswagen to hold news conference about global alliance 1:12 PM, Jul 11, 2019
Ginger Lawrence | 12 July, 2019, 21:54

Ford and Volkswagen announced jointly on Friday that VW will share its MEB affordable electric vehicle architecture with Ford, while VW will join Ford's Argo self-driving effort.

Credit Suisse said an an expanded alliance between the two companies could combine VW's strength in EVs with Ford's in autonomous vehicles, allowing both to "address these challenges in a more capital-efficient manner".

Ford and VW have scheduled a press conference for 8 a.m. Friday in NY to update investors on the alliance they first formalized in January.

Auto firms are also facing new competitors in the industry such as Google and Uber which are also working on self-driving vehicles and have access to enormous financial resources.

The Ford-VW alliance vaults Argo into one of the highest-valued autonomous vehicle development companies in the world.

The value of VW's contribution to the collaboration is more than $2 billion, including about $1 billion invested, said two industry sources who requested anonymity discussing the deal.

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VW will become an equal stakeholder in Ford's autonomous vehicles venture.

Ford will also sell electric cars in Europe based on its own platforms, including the Mustang-inspired Mach E SUV due out in 2021 and the electric F150 it has under development.

Volkswagen will provide not only the vehicle architecture, but also batteries, for up to 600,000 examples of the auto, and the companies are continuing discussions to build a second MEB-based electric model for Ford of Europe with almost as large a volume, and VW CEO Herbert Diess allowed that Ford EVs based on the platform could also come to the USA, though none are now planned. Over the next three years, VW will also buy an additional $500 million of Argo AI shares from Ford.

It has sought outside investors to help share the spiraling cost of developing autonomous vehicle technology. Volkswagen will officially open up use of its MEB scalable electric-vehicle platform, which Ford will use for an all-new EV model that's aimed to go on sale in 2023.

Many automobile companies are joining forces because they're under pressure to develop autonomous vehicles and smartphone-enabled transportation services. That's the automaker's in-house autonomous vehicle development unit, which now has 200 employees.

Akshay Anand, executive analyst at Kelley Blue Book, said in an emailed statement that partnerships such as this one "will continue to ramp up in coming years, crossing boundaries most would not have envisioned even 10 years ago".