Volkswagen Group is close to an agreement with Ford Motor Company regarding cooperation between the two on electric vehicles and autonomous vehicles. The move would further deepen an alliance between the two formed around shared production of commercial vehicles.
News of furthering the alliance comes from Volkswagen Group CEO Herbert Diess, who said talks with Ford are “progressing well” and could be finalized very soon. Diess made the statement during prepared remarks at a gathering of the company’s 500 most senior executives in Wolfsburg, Germany, reports Automotive News.
Facing a downturn in China–VW’s largest sales market–and an uncertain trade environment, the company is keen on finding ways to boost its weakest market, the U.S.
People familiar with the talks say the plan will likely include a Volkswagen investment into Ford’s Argo AI, which is the automaker’s autonomous driving unit. A Volkswagen investment would bring Argo AI into a similar league as Google’s Waymo and General Motors’ Cruise Automation unit.
An investment into Argo AI and deeper collaboration with Ford will likely boost VW’s own valuation, another goal for the global automaker.
As automakers make the expensive transition to electrification and automation, rivalries have taken a backseat. Almost every major automaker has looked at some form of alliance or all-out merger in an effort to gain the economic scale necessary to invest substantially in both new technologies.
Reports suggest an announcement from Volkswagen and Ford could come as soon as next month.