Ford confirms it will build a vehicle using VW's EV architecture

Daniel Fowler
July 12, 2019

Ford Motor Co (F.N) and Volkswagen AG (VOWG_p.DE) said they will spend billions of dollars to jointly develop electric and self-driving vehicles, deepening a global alliance to slash development and manufacturing costs while positioning VW as the initial victor. Ford CEO Jim Hackett said the production location for the vehicle would be announced at a later date, but that the company is expecting to sell 600,000 over six years and is planning to add a second model on the platform.

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.

If VW agrees to allow Ford to license its electric-vehicle platform, it will help the German automaker hit 2020 earnings estimates by "guaranteeing" some profit from EVs next year, and also would likely provide VW with "an unassailable scale advantage in the market", said Angus Tweedie, a Citigroup analyst.

The funding will value Argo AI at more than $7 billion and give Ford and Volkswagen combined majority control of the company.

Such a deal could boost VW's output of battery-electric vehicles in Europe next year to 400,000 units, he wrote in a report.

Ford does not now sell any pure-electric vehicles.

Volkswagen will sink $2.6 billion into a Pittsburgh autonomous vehicle company that's mostly owned by Ford as part of a broader partnership on electric and self-driving vehicles, the companies confirmed Friday.

USA to improve kidney health with more transplants, home dialysis
Last year, there were more than 21,000 kidney transplants, according to the United Network for Organ Sharing. Azar noted his father was on dialysis for several years before receiving a kidney transplant.

VW will purchase Argo AI shares from Ford for $500m over three years.

Analysts at Citi said Ford's licensing of Volkswagen's MEB platform was a "transformational" step for both companies. Much of the MEB's development cost could be recovered from the revenues generated from Ford.

"Our global alliance is beginning to demonstrate even greater promise, and we are continuing to look at other areas on which we might collaborate", Diess said.

Auto and tech industry experts say partnerships like Ford and VW will become more common. (Ford will still complete its billion-dollar investment in Argo AI).

Volkswagen's MEB platform can be used for a variety of vehicle types.

Volkswagen will contribute its Autonomous Intelligent Driving (AID) company to Argo, which will boost the self-driving unit's employees to 700 from 500.

"The research and development to develop these new technologies also costs billions, so it makes sense to share the burden rather than duplicating", he said. The apparent agreement between the global manufacturers is the latest sign of how pressure to cut carbon emissions and fend off challengers from the technology industry is driving consolidation among automakers.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER