Sources said that the deal will result in “billions of dollars” in investments, allowing the companies to share both intellectual property and hardware. The announcement is scheduled for Friday (July 12), with the companies revealing that they will “provide an update on their global alliance” and “share details of new collaborations also aimed at better serving their customers while improving each company’s competitiveness and capital efficiency.”
While VW and Ford declined to give more details, the sources said that Volkswagen will provide Ford with access to its MEB platform — which anchors the ID.3, the first long-range all-electric VW model — as well as a range of other products.
In addition, Volkswagen will invest “in the billions” in Argo AI, a Pittsburgh-based research firm specializing in autonomous vehicle development that Ford became a lead investor in two years ago.
As a result, Argo AI will open its first office in Europe to work closely with VW, and is already testing modified Ford products in five U.S. cities. There are also plans to add similar programs in Europe, giving both automakers a leg up on their rivals.
Dozens of global automakers, as well as tech companies like Waymo and China’s Pony.ai, are competing to bring the first autonomous cars to market. A recent study estimated that the industry’s annual spending on autonomous driving and electric vehicles will reach a combined $85 billion and $225 billion, respectively, by 2025.
That will strain corporate budgets, decrease profits and lead to even more joint ventures, said Mark Wakefield, the head of consulting firm AlixPartners’s auto practice, according to CNBC. And it could also lead to “consolidation happening in the next couple of years,” James Peng, the co-founder and CEO of Pony.ai, said in an interview earlier this week.