VW Confirms Commercial Vehicle Partnership With Ford, Denies Full Merger

The rumor of a full-fledged merger between VW and Ford has come to an end, but their commercial vehicle partnership is officially a go.

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Volkswagen CEO Herbert Diess has officially confirmed longstanding rumors that the automaker’s alliance with Ford would result in a commercial vehicle partnership, but denied theories of a full merger, Autocar reports

At Friday’s annual VW Group board meeting press conference, Diess explained that the company will develop commercial vehicles with the Dearborn-based automaker, and has certainly “identified other potential cooperation with Ford outside of commercial vehicles.” 

This joint venture on commercial vehicle development, which will include the advancement of electric and autonomous car technologies, is “core to the alliance,” Diess explained. The possibility of a full, heavily speculated corporate merger, however, “was never the objective of our talks.”

Diess added that the VW Group has ramped its five-year investment into electric, autonomous, and connected vehicle technology up from 34 billion euros to 44 billion euros. The increase comprises around a third of the company’s total costs for the period, with 30 billion euros going toward electric mobility, such as powertrain development and infrastructure expenditures. 

In terms of the global electric vehicle (EV) landscape, Diess sees “few reasons” for most customers to dismiss EVs as the most logical option by 2020. “For those who drive less than 30,000 kilometers a year, electric will be their first choice,” he said. 

Head of the VW Works council, Bernd Osterloh, expressed the company’s urge to be “part of battery manufacturing close to where cars are produced.” As VW currently has three dedicated EV plants up and running across Germany, and Diess said that it “doesn’t make sense” to spread EV production across Europe, connecting these dots may provide an inkling regarding the decision-making behind VW’s upcoming, partnered manufacturing plans.

Meanwhile, Ford confirmed a strategic partnership with Indian automotive group Mahindra last month, which will have the two automakers jointly develop connected vehicle solutions for both present and future products.

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