By on January 15, 2019

2019 Ford Ranger, Image: Ford

Months of speculation and rumors came to an end in Detroit Tuesday, as auto giants Ford Motor Company and Volkswagen Group officially announced they will take their relationship to the next level.

After signing a Memorandum of Understanding last year, initially to explore joint commercial vehicle production, the two automakers now say their pact will birth a midsize pickup truck for global markets. Volkswagen Ranger, anyone?

The alliance doesn’t end there, but commercial vans and the aforementioned truck are the only joint products the two are willing to confirm at this point. It’s possible the efficiency-seeking companies could broaden their relationship to include electric vehicles, autonomous vehicles, and mobility services.

In a joint release, the automakers stated their intention “to develop commercial vans and medium-sized pickups for global markets beginning as early as 2022.”

Unlike the Renault-Nissan-Mitsubishi Alliance, this tie-up does not involve any cross-ownership between the two companies. Overseeing the partnership will be a joint committee, with VW CEO Herbert Diess and Ford CEO Jim Hackett sitting at the top, surrounded by execs from both companies.

“The alliance will drive significant scale and efficiencies and enable both companies to share investments in vehicle architectures that deliver distinct capabilities and technologies,” the automakers stated. “The companies estimate the commercial van and pickup cooperation will yield improved annual pre-tax operating results, starting in 2023.”

2017 Volkswagen Amarok, Image: Volkswagen

It became clear last fall that Volkswagen was interested in Ford’s pickup prowess, with Diess letting slip that ongoing talks between the two companies encompassed that possibility, as well as others. Indeed, the alliance may very well go in on EVs together, what with VW boasting a versatile electric vehicle architecture, as well as autonomous tech, which Ford has spent years and no shortage of bucks pursuing.

“Both companies also said they were open to considering additional vehicle programs in the future,” the joint statement read.

The timing of the truck production is interesting. Just last week, Road & Track published details on the next-generation Ford Ranger, tentatively due out in 2022. Meanwhile, Volkswagen’s overseas-market Amarok, a body-on-frame midsize pickup produced since 2010, is growing long in the tooth. The automaker registered the Amarok nameplate in the U.S. early last year.

Producing a next-gen Amarok using co-funded Ford bones would save VW money compared to a ground-up redesign, and these days VW is all about slashing costs to fund its EV product wave. That wave gets underway in earnest in the 2020-2022 time frame.

In this relationship, Ford would develop and build the VW-badged trucks. As for the commercial vehicles, Ford is also tasked with developing and building larger vans for the European market, while VW would develop and build a smaller city van. The companies insist the respective models will differ from each other in more ways than just a badge.

In a statement, Hackett said, “Over time, this alliance will help both companies create value and meet the needs of our customers and society. It will not only drive significant efficiencies and help both companies improve their fitness, but also gives us the opportunity to collaborate on shaping the next era of mobility.”

Diess echoed Hackett’s words, calling the alliance “a cornerstone for our drive to improve competitiveness.”

[Image: Ford Motor Company, VW Group]

Get the latest TTAC e-Newsletter!

Recommended

34 Comments on “Ford and Volkswagen Announce Alliance; Joint Pickup Project Is a Go...”


  • avatar
    PrincipalDan

    Park your VW-Ford next to your Routan.

    (BTW if I ever see that combo in a driveway I’ll probably laugh so hard I’ll have to pull over.)

  • avatar
    schmitt trigger

    Do we remember how the last German-American automotive alliance went?

    I know, I know. Last time it was a “partnership among equals”.

  • avatar
    schmitt trigger

    @JohnT:
    My comments were done tongue in cheek. I KNOW this time the financial situation is totally different.

    However, I still believe the cultural differences will definitively play a role in this alliance.

  • avatar
    Bimmer

    Ford is doing well as is in a pick-up and a commercial van market. But they’re not doing well in a car market. Other then saving a portion of the investment, how does it benefit Ford? It’s not like VW announced that they’ll be sharing Know-how on car/electric car production with Ford.

    The furniture guy gotta go!

    • 0 avatar
      JohnTaurus

      Maybe not according to this article, but they have.

      “Additionally, Hackett and Diess said the automakers have signed a memorandum of understanding to explore co-developing technologies for electric vehicles, autonomous vehicles and mobility. The automakers didn’t announce specifics for EVs, citing a competitive market and the need to work quietly, but Hackett said not to assume there hasn’t been been an agreement.”

      (From AutoBlog)

      The assumption is that Ford will use VW’s MEB electric platform, and VW will invest in Ford’s autonomous program.

      Ford has the well-received new Focus and Fiesta, they just chose not to sell them here. Were you expecting a rebadged 8 year old Passat? It’s not exactly setting the market on fire. Ford cars outsell VW cars here, but that isnt enough to make them profitable.

      • 0 avatar
        kamiller42

        I read Ford may use VW’s EV platform, but why? Hasn’t Ford said they’ve been developing a fleet of electric vehicles for years? That’s a lot of R&D to throw away.

  • avatar
    DedBull

    So the way i read this, the product shakeup will go something like this:

    The VW Amarok will go away as a VW product, and will become a VWised next gen Ranger.

    The VW Crafter vans/chassis cabs will go away and be replaced by Ford Transit family vehicles.

    The VW Transporter may become a Ford product, or may continue as a VW product.

    The Ford Transit Connect will go away and be replaced by a VW Caddy product.

    Both manufacturers will sell this full product line with their own respective brand and model names through independent sales channels.

    Probably none of this product with the exception of the truck will come to the US.

    • 0 avatar
      JohnTaurus

      I wouldnt assume that Ford will abandon the Transit Connect for this market, even if it becomes a VW-developed model. It leads the segment by a pretty decent margin.

      • 0 avatar
        DedBull

        I should have clarified I meant the VW badged products.

        I do see Ford continuing to sell a Transit Connect style product in the US. That fits in with their product line and protects the commercial market. It makes sense with no car platform to base it from to shift to the VW platform.

        I am also interested to see if they develop a smaller than Transit Connect vehicle to replace the Transit Courier and Fiesta Van products.

        Maybe the Transporter will become the Transit Connect and the Caddy will become the Transit Courier.

        • 0 avatar
          dtremit

          @DedBull Probably depends on whether Ford and VW end up sharing manufacturing of the products — not sure I’ve seen that clarified.

          The major impediment to VW importing its vans / trucks / etc here is the “chicken tax.” VW isn’t likely to sell enough vans or trucks in the US to manufacture them here, but if they can have Ford build them for the US market they might be more likely to get into the game.

          Federalization is probably also an issue, but I imagine any product Ford intends to sell here will likely be fairly readily adapted.

  • avatar
    ToddAtlasF1

    I wouldn’t even be comfortable leaving my car parked next to the result of a Ford-VW partnership. Ford’s fuel leaks paired with VW’s electrical shorts? The opportunities for growth are explosive!

  • avatar
    jfk-usaf

    Yaaay … Here comes the Shelby GTI and the Atlas Raptor. … Might actually go for an Atlas Raptor

  • avatar
    KingShango

    I fail to see what’s in this for Ford. Why do all the R&D work so VW can slap a badge on it and take the market share? Even if VW is really that far ahead in EV production and research Ford is basically trading high margin truck sales now for low margin future EV products.

  • avatar
    DedBull

    I should have clarified I meant the VW badged products.

    I do see Ford continuing to sell a Transit Connect style product in the US. That fits in with their product line and protects the commercial market. It makes sense with no car platform to base it from to shift to the VW platform.

    I am also interested to see if they develop a smaller than Transit Connect vehicle to replace the Transit Courier and Fiesta Van products.

    Maybe the Transporter will become the Transit Connect and the Caddy will become the Transit Courier.

  • avatar
    Pete Zaitcev

    So, that Focus-based pickup is dead? That would be very unfortunate! Unless… they replace it with a Golf-based one. Wait, where did I see something like that before?

  • avatar
    Vulpine

    What this means is that we will not be seeing a VW pickup in the US and the new “global” Ranger will be built on the VW platform–at least until VW goes all the way over to battery-electric.

    • 0 avatar
      CC

      Congrats, I think you got that 100% wrong.
      The plan IS to sell the new pickup as Amarok in the US and the next Gen Ranger IS currently being develped in Australia by FORD (just like the current generation was).

      • 0 avatar
        Vulpine

        I believe less wrong than you imagine. Remember, they’re only adding EV production to the Chattanooga plant… very probably taking over an existing line, though there may be enough room on the property for some expansion. If the Amarok isn’t already in the US, the odds are dim that it will come unless it is built as an EV (which wouldn’t necessarily be a bad thing.)

        On the other hand, if the Amarok does become a US product for VW, the odds are higher that it will be built in the Ranger plant, probably on the same platform as the Ranger, even if with different body panels. It wouldn’t be all that different from what Ford did with the Mazda pickups.

  • avatar

    Diess will eat Hackett for breakfast and then ask for more. Not even funny. Ford probably has too much cash stashed away that VW can use for the world domination.

  • avatar
    Steve203

    There are a lot of moving parts, and the story is in no way finished.

    From what I have read during the day:

    The original plan was to have a live, joint, hour long presentation at the Detroit show this morning. That was canceled last night and replaced by a conference call. The news release about the truck tieup was already on the news wires at 8:30am, when the conference call was scheduled to start. Bill Ford was quoted that there may be additional information later this week.

    In the truck deal, all the vehicles that Ford leads will be produced in Ford plants. The vehicles VW leads on will be produced in VW plants.

    VW has decided Hannover and Emden will be it’s electric vehicle centers. That means existing product needs to find a new home.

    So, the Transporter will move from Hannover to, in all probability, the Ford Transit plant in Turkey.

    The Amarok moves from Hannover to a Ford plant building the Ranger, my speculation: maybe Brazil, maybe the Ranger is added to the Turkish plant.

    The Passat moves from Emden to the Skoda plant in Kvasiny. Thing is, the Skoda plant is already going at full trot, so, to make room for the Passat, VW plans to move the Skoda Karoq and Seat Ateca (versions of the short wheelbase Tiguan) elsewhere. They want to move the Skoda and Seat models to somewhere in eastern Europe where the labor rates are comparable to Czech rates to maintain pricing. Currently examined options are: covert existing engine plant in Poland, convert existing engine plant in Hungary, greenfield plant in Romania, greenfield plant in Turkey.

    Ford has a plant in Romania, currently producing the Ecosport and appears to be running at less than 50% of capacity. My speculation is there may be negotiations to move the Skoda and Seat products that lose their home in Kvasiny into the Romanian Ford plant. Maybe that is the next shoe to drop, that Bill Ford was hinting at.

    • 0 avatar
      Vulpine

      This is Ford trying to reduce its costs in Europe and Asia. What, really, does VW get out of it? If VW itself is going all-EV, then they’re probably eliminating production of some models and putting them into the Ford plants. But with VW saying 40 different models in roughly 5-8 years’ time, it’s definitely a short-term deal for both of them.

      • 0 avatar
        DedBull

        My guess, this allows VW to not need to develop another generation of ICE powered commercial vehicles to introduce to the marketplace in the mid 2020’s. Instead they can free a large number of those resources to focus on the wave of BEV commercial/commuter vehicles that are 2 generations down the road. They will foist all the developmental costs off on Ford for the last wave of ICE vehicles and instead will be able to come to market with a majority BEV product line while everyone else is years behind due to developing both generations.

      • 0 avatar
        Steve203

        What does VW get out of it? Avoiding the cost of developing a next gen Transit and Amarok, as well as freeing up the Hannover plant for EV production, rather than building a greenfield EV plant.

        Meanwhile, the VW Caddy plant in Poland picks up the volume of the Ford Transit Connect and Transit Courier, so VW has more units to amortize Caddy development over.

        The entire plan has not yet been revealed. Those VW EV plants in Hannover and Emden could end up building Ford EVs.

        Then there is the issue of Ford needing cars like the Ka, Fiesta and Focus to be a player in Europe, but Dearborn not really interested in investing in passenger cars. There may be VW based Fiestas and Foci in the future. In an interview a couple days ago, Jim Hackett was talking about “the Ford brand” and selling “Ford branded” cars in Europe. “Ford branded” does not mean Ford designed and built. “Ford branded” could as easily mean a badge engineered Skoda.

        • 0 avatar
          dtremit

          The second-gen Ka was already a Fiat, so there’s certainly a track record there.

          That said, my understanding is that the new Focus in Europe is based on a new universal FWD platform equivalent to VW’s MQB. It’s eventually expected to underpin basically everything from the Fiesta to the Edge. There wouldn’t be much point in rebadging a MQB car if they can design their own with huge part sharing and run it down the same line as everything else.


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • rpn453: The Micra is still available in Canada at an MSRP of CDN$10500 (US$7900). I’d be interested in test...
  • thegamper: Pure speculation on my part, but I would think as more luxury automakers get EV’s to market with...
  • Rocket: I don’t see it. For one, it’s a lot of money to spend. But more important, Toyota is all about...
  • Giskard: Unlike other cars an electric car is likely to “know” it’s plugged in. My i3s, for...
  • Lie2me: I agree, or at least greatly reduce the amount of salt used. Here in southern Wisconsin I appreciate that...

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States