Ford will engineer and build medium-sized pickups for both companies, which are expected to launch in 2022.
There have been reports that Ford and Volkswagen have been planning to join forces and build new vehicles together, but now it's official. At Detroit, the two automakers announced the first formal agreements in a "broad alliance that positions the companies to boost competitiveness and better serve customers in an era of rapid change in the industry." However, the alliance does not entail cross-ownership between the two companies.
Volkswagen CEO Dr. Herbert Diess and Ford CEO Jim Hackett confirmed the companies intend to develop commercial vans and medium-sized pickups for global markets as early as 2022. 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 collaboration should also result in improved annual pre-tax operating results starting in 2023.
In addition, Volkswagen and Ford have signed a memorandum of understanding to investigate collaboration on autonomous vehicles, mobility services, and electric vehicles and have started to explore opportunities while also considering additional vehicle programs.
"Over time, this alliance will help both companies create value and meet the needs of our customers and society," Ford CEO Jim Hackett said. "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."
VW CEO Dr. Herbert Diess added: "Volkswagen and Ford will harness our collective resources, innovation capabilities and complementary market positions to even better serve millions of customers around the world. At the same time, the alliance will be a cornerstone for our drive to improve competitiveness."
Ford and Volkswagen both have established strong commercial van and pickup businesses worldwide, with popular nameplates such as the Ford Transit family and Ranger as well as the Volkswagen Transporter, Caddy and Amarok. Together, the companies' collective light commercial vehicle volumes from 2018 totaled approximately 1.2 million units globally, which could represent the industry's highest-volume collaboration as production scales.
VW and Ford aim to capitalize on the increasing demand for medium pickups and commercial vans, which is expected to grow in the next five years. The alliance will "enable the companies to share development costs, leverage their respective manufacturing capacity, boost the capability and competitiveness of their vehicles and deliver cost efficiencies, while maintaining distinct brand characteristics."
As part of the automotive alliance, Ford will engineer and build medium-sized pickups for both companies, which are expected to launch in 2022, and build larger commercial vans for Europe. Volkswagen, on the other hand, intends to develop and build a city van.