► Ford and VW in strategic alliance
► Advanced talks, no equity swap
► Likely to build vans together
Ford and Volkswagen have announced more details of their much-mooted strategic alliance with an announcement from Dr Herbert Diess and and Jim Hackett, Volkswagen and Ford’s respective bosses.
The announcement states that the alliance ‘leverages the two global automakers’ strengths to better compete, innovate and serve customers’ but stressed that it wasn’t cross-ownership, like the Renault-Nissan-Mitsubishi Alliance. The alliance would be governed by a separate board led by Diess and Hackett.
The first part of the new relationship comes in the shape of commercial vehicle agreements, with the plan to develop vans and ‘mid-sized’ pickups (so the next-generation VW Amarok and Ford Ranger) for all markets from 2022. There’ll be platform, tech and engine sharing to maximise economies of scale, with Ford building both its version and the VW one. As for vans, Ford will engineer the larger end of the scale, while VW will balance out the equation by building what it calls a ‘city van’ - a.k.a the next VW Caddy.
'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', said VW CEO, Dr Herbert Diess. Hackett added, '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.'
On top of the commercial vehicle plans, Ford and VW have signed a memorandum to look into working together on electric and autonomous vehicles, along with investigating mobility services. While Volkswagen has already announced, and made great leaps into developing, a full suite of new all-electric models joining the range by 2025, Ford is lagging behind.
So, what is Ford going to do about it?
Our intel suggests the brand will start rolling all-electric cars out from 2020. The Mach 1 electric crossover has already been teased, with an aim to build it in 2020, while an electric Focus and new-generation Kuga EV are in the pipeline for 2023 and 2025 respectively. That’s on top of mild hybrids and plug-in models expected, too.
How do VW’s plans compare?
They are so much grander. Wolfsburg has already shouted from the rooftops that it wants to sell three million battery-electric cars by 2025. No fewer than 27 MEB derivatives badged VW, Audi, Skoda and Seat will be in production by 2022, sources say. Here is a reminder of what to expect when on the battery front from the VW brand:
- New e-Up – intended for EU, with better range
- New e-Golf – expected 2020 after Mk8 Golf, but it might not happen at all, because of…
- ID Neo – the first model to use the new MEB electric framework from VW Group, from 2020
- ID Crozz – A crossover variant of ID range will come in 2020, too
- ID Buzz – the Microbus goes electric, plus cargo van; from 2021
- ID Vizzion – four-door saloon; dimensions of a Passat, space of an A8; from 2022
Why are Ford and VW looking to strike a partnership?
The move reflects the expense of developing new models - especially in an age when many manufacturers are having to stump up additional costs to develop costly new digital platforms, extra ownership services and autonomous driving capabilities.
Ford also announced plans to renovate the famous Michigan Central Station in downtown Detroit - a stunning 1914 landmark that has run into disrepair in the Blue Oval's hometown. It will turn the Beaux-Arts Classical building into offices for 5000 software and tech specialists.
'Ford is committed to improving our fitness as a business and leveraging adaptive business models – which include working with partners to improve our effectiveness and efficiency,' said Jim Farley, Ford’s president of global markets. 'This potential alliance with the Volkswagen Group is another example of how we can become more fit as a business, while creating a winning global product portfolio and extending our capabilities. We look forward to exploring with the Volkswagen team in the days ahead how we might work together to better serve the evolving needs of commercial vehicle customers – and much more.'
Meanwhile, the head of VW Group strategy, Thomas Sedran, said: 'Markets and customer demand are changing at an incredible speed. Both companies have strong and complementary positions in different commercial vehicle segments already. To adapt to the challenging environment, it is of utmost importance to gain flexibility through alliances.'
Picture credit: Parkers.co.uk Vans section