Ford and Volkswagen Gear Up for a Global Alliance

 

Ford CEO Jim Hackett and Volkswagen CEO Dr. Hebert Diess were together on a New York stage July 13th. The two were joined by Argo AI CEO Bryan Salesky, and in front of a crowd announced that we are entering the “biggest shift in transportation” since the time of Henry Ford.

 

So what’s happening? What’s so big? Well, the two automotive giants are joining forces to expand their global alliance in one of the biggest events in the auto industry ever.

 

This isn’t a merger or anything, this is a true collaboration, and what’s most exciting is that Volkswagen is giving Ford the keys to its electric vehicle platform, the Modular Electric Toolkit. This will give Ford the power to produce some 600,000 vehicles in Europe over the next six years. This platform is the very same that VW plans to use for the production of a planned 15 million battery-electric vehicles over the next 10 years.

 

These two companies, through their sheer size and influence, are setting the new standard for electric vehicle architecture. This agreement will truly change the automotive market. 

 

Diess explained that by opening MEB to Ford, both companies can drive down production costs. That gives them the ability to sell these new vehicles at a very attractive price. This price will likely increase demand which in turn furthers the lowering of costs. 

 

This isn’t just a case of Ford buying the Modular Electric Toolkit, no, this is a partnership. Because Ford has a research and development team in Aachen, Germany, those Ford engineers can work closely with Volkswagen.

 

Here’s where Argo AI comes in. Argo AI is developing an autonomous vehicle platform, and both Ford and Volkswagen have invested heavily in the business. In fact, the two companies own a majority of Argo AI. What made Argo AI so attractive is that they are building for scale, they’re preparing for production, they have automotive grade sensors and computers, and they are able to fully integrate their tech with OEMs. 

 

Hackett notably called out the technology sector: think Google, Facebook, Apple, and Microsoft. “There will only be a few winners.” Ford and Volkswagen hope to be among those few.

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