Ford and Volkswagen have used the Detroit motor show to confirm the pair will enter into a global alliance.
As has been widely speculated, the brands will collaborate to develop commercial vans and medium-sized pickups for global markets beginning as early as 2022.
Obviously, this move will lower costs associated with developing new platforms and technologies. Both companies want to boost their respective market competitiveness and see this as a solution in “an era of rapid change in the industry.”
Along with sharing development costs, Ford and Volkswagen will leverage their respective manufacturing capacity to deliver cost savings.
The companies estimate the commercial van and ute cooperation will yield improved annual pre-tax operating results, starting in 2023.
Under the terms of the alliance agreement, Ford will engineer and build medium-sized pickups for both companies which are expected to go to market as early as 2022.
Ford will also be responsible for developing and manufacturing larger commercial vans for European customers, while Volkswagen intends to develop and build a new city van.
The alliance will be governed by a joint committee and not entail cross-ownership between the two companies.
In 2018, Ford and Volkswagen sold approximately 1.2 million light commercial vehicles globally.
Ford and Volkswagen have also signed a memorandum of understanding to investigate collaboration on autonomous vehicles, mobility services and electric vehicles.
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