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Ford & Volkswagen On The Verge Of Announcing Partnership

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Ford and Volkswagen are widely expected to announce a wide-ranging partnership at next week’s Detroit Auto Show.

For months now, Ford and Volkswagen have been in talks about partnering up on various new endeavors. It started with an announcement last summer with the two companies co-developing the next generation of commercial vehicles. Then it expanded into a rumored collaboration on the next generation of mid-size pickup trucks, with the redesign Amarok and Ranger to share a platform.

Since then, even larger rumors have swirled about Ford and VW entering into an official partnership, making them the largest automaker in the world. That announcement seems closer to reality than ever, with multiple news outlets reporting that a global alliance is expected to be announced next week in Detroit.

The North American International Auto Show’s official schedule has Ford and VW penned to release a “pending industry announcement” on Tuesday, January 15th. According to the Detroit Free Press, sources say this is to announce the two company’s partnership, but “nothing is definite” yet.

"Our memorandum of understanding with VW covers conversations about potential collaborations across a number of areas," Ford spokeswoman Jennifer Flake told the Free Press. "It is premature to share additional details at this time. We look forward to sharing an update soon."

Reuters reports that “a global alliance is expected to be announced,” while Bloomberg states that the VW board of directors is set to discuss the alliance on Friday, with their approval allowing Tuesday’s announcement to move forward.

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Details of the announcement have yet to be finalized, but the expectation is that Ford and VW will share development for driverless and electric vehicle technology with a focus on cutting costs. Both companies have lagged behind their competitors in this department, and a partnership would allow them to catch up while minimizing their expected research and development costs.

Ford
via Detroit Free Press

There are also rumors that Ford would build Volkswagen vehicles in the United States to allow VW a greater penetration of the US market. This would not only create and retain manufacturing jobs in the US for Ford, but it would also allow Volkswagen to cut costs of their vehicles and achieve a price advantage over their competitors.

Since Ford no longer creates cars in North America, VW wouldn’t compete with Ford for sales of sedans and coupes.

We’ll learn more next Tuesday after Ford and VW’s announcement.

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