By on November 9, 2018

Volkswagen AG and Ford Motor Co. continue to become more chummy with each passing day. They may even be on the cusp of sittin’ in a tree, K-I-S-S-I-N-G.

After signing a Memorandum of Understanding in June, executives are now hinting at widespread collaboration. Ford wants help in Europe and Latin America, areas awash in a sea of red. Volkswagen wants a piece of Ford’s self-driving technology, while the pair would work together on electric vehicles, according to recent reports. It’s worth noting that Ford, which has proven more open in discussing the matter, previously said nothing would be off the table if the two joined forces.

The most recent update concerns VW’s proposed investment in Ford’s self-driving partner, Argo AI. While both companies are dead set on a future of “electro mobility,” both fall short in critical areas. 

Over the past few years, Ford managed to get quite a bit of autonomous testing under its belt, but it’s not seen as a leader in the field — though how far it actually lags behind General Motors is debatable. Meanwhile, Volkswagen promised widespread electrification by 2022 and expects to build up to three million electric vehicles annually by 2025. Right on cue, supplier issues have cropped up. The Blue Oval’s vision is similar to VW’s — a continued shift towards light trucks, with a flagship EV in the wings and more electrification to follow. But it doesn’t appear as if Ford will have a glut of competitive battery-electric vehicles on the market for some time. Gaining access to Volkswagen Group’s MEB platform could change that… theoretically.

According to Bloomberg, people familiar with the situation claim the two might solidify initial agreements by the end of end of this year or early 2019. VW refused to say what that might entail; Ford said it’s currently in discussion with VW over potential collaborations across multiple areas but that it would be premature to share additional details. Neither has any plan for a cross-shareholding arrangement like Nissan Motor has with Renault.

That’s not much to go on, though Volkswagen CEO Herbert Diess recently confessed to Automotive News that Ford could gain access to the MEB platform and that the Germans could use the Ranger pickup to replace the Amarok on the global market.

Even more rumors include discussions of VW offering the pint-sized Caddy van to Ford in exchange for the Americans building a replacement for the T6 Transporter at its own van plant in Turkey. We probably won’t see the bastard offspring of either arrangement in North America.

On the autonomous side of things, Volkswagen’s investment in Argo would likely mimic Honda’s conditional $2.75 billion investment in General Motors’ Cruise division. Still, with the two companies so wrapped up in everything else, we doubt it would implement the same stipulations that Honda did with GM.

“We’re having a very broad set of discussions about how we can help each other around the world,” Ford CFO Bob Shanks told Bloomberg last month. “Collaboration isn’t being limited in any way whatsoever.”

The marriage makes a lot of sense, honestly. Automakers are terrified that governments, especially those in Europe and China, will prohibit everything that isn’t electric from entering major cities in the coming years. Not having a lineup of vehicles that can adhere to that specific brand of vehicular authoritarianism would be a death sentence for an automaker. Likewise, autonomy is seen as the key for opening up the door to new business opportunities that could be worth trillions in the coming decades.

Now, we’ll just have to see if they can pen an agreement both parties can shake on. It’s looking like they’re already in the home stretch.

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30 Comments on “Volkswagen and Ford Move Closer to an Agreement on Autonomy, Electrification, Assembly...”


  • avatar
    NG5

    Laughed aloud at this photoshop. Nice work.

  • avatar
    Wheatridger

    Speaking as one of a few VW diehards who recently crossed the fence to buy a Ford car, my oddball, contrarian viewpoints may and will be discarded here. Ford won me over with their plug-in hybrid drivetrain, which is has the best combination of power, quietness and efficiency that I’ve experienced. The C-Max, being just a fat Focus design, also had crisp handling and steering that didn’t leave me missing my trade-in, a GTI. And finally, a heavy-duty A/C system that loafs while managing triple-digit temps, USA-style!

    If I could add VW seats to the car and restyle it with German restraint, it would be perfect for me. That’s what I’d hope for with a Ford-VW partnership. Let them sell just enough tricks to keep the lights on, it’s the cars I want. So I’ll dare to be optimistic and predict something good could come from this. It’s more promising, at least, than the Indian partnership that brings us the dreadful EcoSport.

    • 0 avatar
      highdesertcat

      You should never presume that your viewpoints “will be discarded here.” There may be a great number of readers who may actually feel the same way you do but feel no need to comment and set off the ttac trolls.

      I put my preference for Toyota products in writing because I became a convert in 2008, away from the lifelong habit of buying GM and Ford vehicles.

      And to my surprise, I have seen a number of people I know actually switch to Toyota products, especially the outdated Tundra with that magnificent all-aluminum, 32-valve, DOHC, 5.7L V8.

      There a number of fair and open-minded readers yet on ttac, although their numbers are dwindling as the ttac-trolls are increasingly push them to other automotive sites.

    • 0 avatar
      Big Al from Oz

      Wheatridger,
      I own a Ford more or less and I love it …… but my mother has a Michigan made Focus, which is a piece of crap. I do know the Thai made Focus is of far higher quality. Ford in the US as many of the other manufacturers in the US produce vehicles of lower quality than their global counterparts.

      I do think US made Toyotas are very good as the Hyundai/Kia vehicles, far better than GM and Ford.

  • avatar
    Sikeh Beryuf

    Volkswagen is trying to catch with New Technology. It is a great move. However technology changes fast with the era where cars will be able to talk to each other around the corner. So the earlier Volkswagen starts investing in developing New technologies too, the better.

    Ford had understood the future trends in the evolution of cars with automation and electric designs being in fashion. With climate change, electric cars will soon be the norme.

  • avatar
    tankinbeans

    I have no experience owning a VW, but I’ve owned several Ford’s including two (well 3 now I suppose) of the German engineered Focus – 2 of which being the NA 2.0 and 1 being an ST. I’ve also had an Escape. My family have been Ford people since I was little, and my dad had a 99 Escort for 12 years with nary an issue until my brother got into its third accident that finally totalled it.

    I’ve generally thought that VW have put out some of the nicest looking cars on the road, but read the internet forum wisdom that they tend to turn into electrical nightmares. Having never owned one I don’t know how much stock to place in that. YMMV.

    I’m interested in what the cooperation agreement could bring.

  • avatar
    hreardon

    If Volkswagen has demonstrated one thing with MLB, MQB, MSB, MSS and the upcoming MEB for electric cars, it is that these ‘kits’ are incredibly scalable. That the Golf and the Atlas share MQB, and yet are wildly distinct, is impressive. That it actually *works* is more impressive.

    Assuming the same for MEB, selling the basic toolkit to Ford to reskin virtually anyway that Ford sees fit looks to be a big win for both automakers. It doesn’t require a merger or joint venture – it lets VW sell what it’s good at (the platform), it allows Ford to then reskin and market them without the heavy investment in anything other than the sheet metal and interior design.

    While I doubt VW would be willing to sell its MLB and MQB architectures, I could see an agreement whereby VW provides certain kits, so long as the vehicles are only sold in specific markets (think South America, where Ford is strong, VW weak). Heck, even North America.

    Under this scenario, VW gets revenue on additional kits instead of cars – and avoids the overhead of trying to compete head to head in markets where they’re weak. Very intriguing model.

    • 0 avatar
      Big Al from Oz

      hreardon,
      I think VW with such an unusually small footprint in the US compared to the rest of the world Ford is trying to gain.

      VW will only join Ford is VW sees something in it for them. From what I’ve read VW is only interested in sharing with Ford their light commercial vehicles. Which Ford will become more VW orientated, especially with Ford chopping small cars out of the picture. Many small light commercials use car platforms.

  • avatar
    Big Al from Oz

    Well, I’ve been trying to tell everyone that the US manufacturers will be challenged due to the unique regulations, tax structure, etc that has created the US market to become a Jurassic Park.

    The US large vehicles are nice, but, the US needs to become more competitive and build what the world wants. The US vehicle market is becoming less significant as the economies of production and volume diminishes the “world’s most dominant” vehicle market. The US market is big, but the world without the US is 85% of the market.

    Ford’s reliance of F Series sales is ridiculous as the F Series is very protected with huge barriers removing external competition. Ford is not able to compete outside of the US competitively.

    The idea that the “world is against US vehicle manufacturers because the US is so generous” is ridiculous as well. The reason is the rest of the global manufacturers are able to be more competitive in those global markets, and the US manufacturers seem to be floundering.

    Maybe the “old school’ US business model is becoming defunct and the manufacturers have become totally reliant of protection of the large vehicles.

    It think we are getting much closer to D Day for the US manufacturers. The US Government needs to come up with a plan to force the US manufactuers to be weaned off of the huge protection offered to pickups and their related SUV station wagons.

    Ford, you have done this to yourself via poor decision making and management over the past number of decades, like the Aussie manufacturers did (again managed by the US, FoMoCo and GM).

    • 0 avatar
      sportyaccordy

      I think you’re being needlessly harsh on Ford. OK, GM has waxed and waned globally. Chrysler has been a mess for the past 50 years. But Ford? Ford has had top 10 cars in Europe for decades. The top selling coupe in Germany is the Mustang. They just released new Fiestas/Focuses. Etc. They’ve been doing well and are making an effort abroad.

      Ford’s troubles are a mix of their own undoing (i.e. Powershift) and frankly double standards. People dump on Ford for not updating cars but the Camry/Corolla rode on the same platforms and had the same engines for over a decade… nobody complained. 9th gen Civic sucked, people bought it by the truck load. Ford got no such leniency.

      • 0 avatar
        ToddAtlasF1

        I ran an independent shop for the past two years. I saw four or five Hondas a day. I don’t recall ever fixing anything on a 9th generation Civic except a damaged splash shield for an incompetent family lawyer who ran over curbs regularly. Saying they sucked is failing a fundamental litmus test of understanding what people typically need out of a compact car. Every fool who read the sell-out buff books and bought a Focus that turned into junk in five years would have been better off with a 9th generation Civic. Everyone who has a 10th generation Civic probably would be better off with a 9th generation one too.

      • 0 avatar
        Big Al from Oz

        Sportyaccordy,
        I agree with you to a degree. But, you are talking volume not profits. Over the recent past Ford has been dropping globally. Its more the business model than vehicle line up.

        All global manufacturers compete outside the US and some within the US. The Big 3 are kept alive largely by large pickups and their derivative wagon stablemates.

        This to me seems that the Big 3 have internal structural issues, and can’t survive without massive protection and subsidy. This has taken decades to occur, the Big 3’s current position globally is not good. For their survival they need to change through force if necessary.

        • 0 avatar
          DenverMike

          @BAFO – What “subsidies” are you taking about, specifically?

          Put up or shut up time.

          Any “protections” offered to The Big 3 are offered to all automakers that currently sell in the US, just the same, whether they sell pickups in the US (successfully) or not.

          That would include Honda, Nissan and Toyota. Actually it would “protect” them more, since their biggest selling pickups are not 1/2 tons and up. And their pickup buyers are predisposed to buying “imports” anyway, regardless of where they’re built.

          You can’t say BECAUSE of the Chicken tax, worthy global competition, ANY direct competition for Big 3 pickups, 1/2 ton and up especially, to class 4, F-450s (not to mentions big SUVs), don’t exist globally.

          Or can you name them??

          Yes, bigger Big 3 vehicles are designed for North America specifically, and so they struggle in the global arena, but so do bigger Toyotas, Nissans, Hondas, etc. No shame in that game.

          I’m not sure what sells the most in Europe or around the world, but you can bet it’s not, or wouldn’t be a top seller in the US, nor acceptable by US tastes.

          It is what it is.

          But by far the biggest obstacle facing US spec cars and trucks, including those by Toyota, Nissan, Honda, etc, in European/global markets are technical barriers, even more so than tariffs, which are extremely high, especially in the places US specific, US only vehicles is something we like to call “US Lemon Laws”.

          Except the biggest competitors the that could possibly battle, obscenely profitable Big 3 pickups and big SUVs, are already for sale in the US and doing their absolute damnedest to give them hell.

          How’s it working?

          • 0 avatar
            Big Al from Oz

            Um DumberMike, wheeze ain’t talkin within ‘murica butt outside of ‘murica where ‘murican car makers are on the same playing field as all players.

            In ‘murica the chicken tax and ‘murica’s refusal to adopt global regulations is makin it hard. The chicken tax is designed to stop imported pickups, etc.

            Um dumb? Or what?

          • 0 avatar
            DenverMike

            Correction:

            …”But by far the biggest obstacle facing US spec cars and trucks, including those by Toyota, Nissan, Honda, etc, in European/global markets are technical barriers, even more so than tariffs, which are extremely high, especially in the places US specific, US only vehicles [would sell the most]…’

            “…[But then the biggest obstacle/barrier facing global cars and trucks not found in the US] is something we like to call “US Lemon Laws”.

          • 0 avatar
            DenverMike

            “…making it hard…”

            Yeah for who?

            It’s all these imaginary global pickups you can never seem to name for some reason…

            Again, put up or shut up.

            You can never answer the simplest of questions to your off the wall rants out of nowhere, then you simply scamper off.

          • 0 avatar
            sportyaccordy

            Chicken tax is supposed to block imported trucks correct? How would that protect D3’s trucks when most “foreign” mainstream manufacturers have US plants? I am pretty sure Toyota and Nissan’s trucks are built here…. issue you’re not considering is that nobody wants them.

          • 0 avatar
            Big Al from Oz

            Sporty,
            The tax forces manufacturers to build in the US. The problem is volume. Manufactuerers need to make lots of pickups to pay for plants, design, etc. VW stated 100k mimimum to pay for itself.

            Imports can leverage off other markets, reducing costs. Add to the chicken tax the US’es different design regs, etc makes exports more challenging.

            This creates inefficiencies in the US and increases prices.

          • 0 avatar
            DenverMike

            @ BAFO – Now you’re over HERE babbling about “import” pickups, but could you be a little more *vague*??

            With most global commodities, you’d have a point, but we’re not talking oil or steel here. Did I mention “US Lemon Laws” yet??

            When it comes to midsize pickups, we’ve about depleatd the world’s supply. If no, just say which.

            If you think our base pickups could get cheaper with “them” imports, give specify type examples, with real pickups and how they would impact the US pickup market, especially with 3/4 tons in mind, and up..

          • 0 avatar
            sportyaccordy

            Well Ford kind of pigeonholed itself into this situation by chasing volume over profit, either by selling to rental fleets or to retail at steep, steep discounts. They’ve conditioned market expectations of the prices on their non F-150 products but haven’t found a way to make them profitable. It would take them as long to reverse those expectations as it’s taken to set them.

            To add to that I think even with the onslaught of Japanese competition they had the opportunity to stay ahead. They did something special with the Taurus, but then squandered it, and didn’t transfer that excellence to the rest of the brand. What’s done is done though and where they are is where they are.

          • 0 avatar
            Big Al from Oz

            sportyaccordy,
            The other side of my arguement is, if the US was competitive and manufactured pickups to global standards the US would be exporting midsizers to satisfy the global pickup boom.

            So, US pickups are expensive and are not suited.

          • 0 avatar
            JohnTaurus

            Chicken tax! Except Ford pays it on the Transit Connect, still sells it at a competitive price, and still evidently makes a profit (or it would’ve been killed off like Fiesta and Focus in this market), and sells enough to make it far-and-above the best seller in the segment it created.

            And Ford needs to STOP SELLING 800,000+ F-SERIES A YEAR so it can begin exporting 1,274 Rangers a year, that are far cheaper to build in Thailand where they’re built already. SAME WITH GM, STOP SELLING HUNDREDS OF THOUSANDS OF FULLSIZE TRUCKS so you can export a couple dozen Colorados to Pakistan and Uruguay. It makes so much sense! Why can’t these stupid Americans see that?!

          • 0 avatar
            Big Al from Oz

            John,
            WTF?

            So its great to pay more than necessary?

            Who the ef do you think is paying for the tax … . Ford?

  • avatar
    pdog_phatpat

    Dont pay him much mind. He’s from a land and long line of castoff criminals. Considering his country literally contributes nothing to the rest of the world, the gloating and stuck up attitude is precious. Oh well, changing trends make it hard for companies sometimes, just gotta change to suit the times. Ford will be fine.


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