Ford and Volkswagen are set to strengthen their alliance next week at the Detroit Motor Show, as the two automakers look to save billions of dollars and propel themselves into new business opportunities surrounding future transportation.
The two auto giants have already been working together in the commercial vehicle segment, but are now looking to explore closer cooperation as trade frictions continue to put pressure on global automakers who are trying to develop electric and self-driving vehicles. Currently, most OEMs do not have the agility and flexibility on their own to replace their entire production lines with smarter and cleaner vehicles and the costs to adapt these types of business structures is substantial.
Each company has a lot to bring to the table. Ford has been heavily involved in smart mobility since CEO Jim Hackett took charge in 2017, investing in new mobility divisions and companies to pursue new opportunities such as autonomous vehicles and adapt to the new ecosystem on the horizon. VW’s perks include its MEB electric vehicle platform, which will allow the two companies to prepare for a mass EV market. The partnership will also allow both companies to speed up decision making and use each other’s facilities to push out new electric and connected vehicles.
VW has said in the past that the only way to make EVs a mass-market product is through economies of scale to make them as affordable as diesel vehicles; this is only achievable with partnerships like this. In terms of self-driving vehicles, Ford is aiming to make them available to the public by 2021, when its new autonomous architecture will be ready. Creating a stronger relationship it vital, so it will be interesting to hear what Ford and VW have to say at the Detroit Auto Show on January 14th.