Ford and Volkswagen Announce New Alliance To Develop Electric Vehicles and Autonomy

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Two of the planet’s largest automakers team up on EVs and automation.

Ford and Volkswagen have announced a global partnership to co-develop autonomous vehicles and electrified vehicles. These two global industry giants combined have more market share than any other entity. They also have a combined history of automotive success that is unmatched. Going forward, they may also have the best chance for success in the future of automobiles.

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The Ford-VW alliance is centered around a company called Argo AI. Pittsburg-based Argo AI is one of many companies that aren’t often in the spotlight, but behind the scenes is developing the artificial intelligence and driving equipment that will enable tomorrow’s autonomous vehicles. Argo AI is partnered with Carnegie Mellon University and the Georgia Institute of Technology. Argo AI’s President, Peter Rander says, “We look for a fit that aligns with our mission and values, and the kind of product we’ve set out to make. The real magic comes in working hand-in-hand to build technology that’s safe — and that people trust, enjoy, and look forward to using. ” Argo AI’s focus is on delivering an SAE Level 4-capable Self Driving System (SDS) to be applied for ride sharing and goods delivery services in dense urban areas. Both Ford and VW plan to integrate the Argo technology independently on their own vehicles.

Related Story: GM and Toyota Invest Big In Autonomous Cars

Ford and Volkswagen will each pour billions into Argo as part of this agreement. Interestingly, VW has been developing its own automation using its own team as well as partnering with Argo. Part of the agreement includes VW “donating” its Autonomous Intelligent Driving (AID) company, which includes more than 200 employees, to Argo AI. Ford and VW will remain equal shareholders in Argo and the total investment is said to be over $7 billion. “While Ford and Volkswagen remain independent and fiercely competitive in the marketplace, teaming up and working with Argo AI on this important technology allows us to deliver unmatched capability, scale, and geographic reach,” said Ford President and CEO Jim Hackett. “Unlocking the synergies across a range of areas allows us to showcase the power of our global alliance in this era of smart vehicles for a smart world.”

Argo plans to establish a new European headquarters in Munich, Germany called AID. It will be led by Argo’s current CEO. “Argo AI is fortunate to have a world-class team due to our clear mission and the commitment to deployment from our partners, and together with AID employees, we will have a global workforce to attract even more of the best talent,” said Salesky, co-founder of Argo AI. “Plus, thanks to Ford and Volkswagen, Argo AI technology could one day reach nearly every market in North America and Europe, applied across multiple brands and to a multitude of vehicle architectures.”

In addition to partnering on the autonomy side of the equation, Ford is also committing to adopting and using Volkswagen’s dedicated electric vehicle architecture and Modular Electric Toolkit – called MEB – to deliver a high-volume zero-emission vehicle in Europe starting in 2023. “Looking ahead, even more customers and the environment will benefit from Volkswagen’s industry-leading EV architecture. Our global alliance is beginning to demonstrate even greater promise, and we are continuing to look at other areas on which we might collaborate,” Volkswagen CEO Dr. Herbert Diess, said. “Scaling our MEB drives down development costs for zero-emissions vehicles, allowing for a broader and faster global adoption of electric vehicles. This improves the positions of both companies through greater capital efficiency, further growth and improved competitiveness.”

Automated driving systems and electric vehicles are two different things, of course. However, they are intertwined. All autonomous vehicles use hybrid-electric or battery-electric vehicle platforms because they require the power that can be generated by, and made available by, the electric drive system.