Ford Motor Company and Volkswagen AG have announced they are expanding their global alliance to include electric vehicles – and will collaborate with Argo AI to introduce autonomous vehicle technology in the US and Europe.
Courtesy of Ford Motors
Argo AI’s self-driving system (SDS) is the first with commercial deployment plans for Europe and the US, the platform having the largest geographic deployment potential of any autonomous driving technology to date. Volkswagen and Ford independently will integrate Argo AI’s SDS into purpose-built vehicles to support the distinct people and goods movement initiatives of both companies. Argo AI’s focus remains on delivering a SAE Level 4-capable SDS to be applied for ride sharing and goods delivery services in dense urban areas.
Ford and Volkswagen will have an equal stake in Argo AI, and combined, Volkswagen and Ford will own a substantial majority. The remainder will be used as an incentive pool for Argo AI employees. The full transaction is subject to regulatory approvals and closing conditions.
Company leaders also announced Ford will become the first additional automaker to use Volkswagen’s dedicated electric vehicle architecture and Modular Electric Toolkit – or MEB – to deliver a high-volume zero-emission vehicle in Europe starting in 2023.
Volkswagen started developing its MEB architecture in 2016, investing approximately $7 billion in this platform. The car-maker is planning to use this platform to build approximately 15 million cars for the Volkswagen Group alone in the next decade. Using Volkswagen’s MEB architecture is part of Ford’s more than $11.5 billion investment in electric vehicles worldwide and supports its commitment to offer its European customers a broad range of electric vehicles while meeting its sustainability commitments.
Ford expects to deliver more than 600,000 European vehicles using the MEB architecture over six years, with a second all-new Ford model for European customers under discussion. This supports Ford’s European strategy, which involves continuing to play on its strengths – including commercial vehicles, compelling crossovers and imported iconic vehicles such as Mustang and Explorer.
“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.”
Volkswagen CEO Dr. Herbert Diess added that even more customers and the environment will benefit from Volkswagen’s EV architecture and that the company is continuing to look at other areas on which it might collaborate. Scaling its MEB will allow Volkswagen to drive down development costs for zero-emissions vehicles, allowing for a broader and faster global adoption of electric vehicles.
The alliance, which covers collaborations outside of Volkswagen and Ford’s joint investments in Argo AI, does not entail cross-ownership between the two companies and is independent from the investment into Argo AI. The alliance is governed by a joint committee, which is led by Hackett and Diess and includes senior executives from both companies.
Volkswagen will invest $2.6 billion in Argo AI by committing $1 billion in funding and contributing its $1.6 billion Autonomous Intelligent Driving (AID) company, which includes more than 200 employees – most of whom have been developing self-driving technology for the Volkswagen Group. As part of the transaction, Volkswagen also will purchase Argo AI shares from Ford for $500 million over three years. Ford will invest the remaining $600 million of its previously announced $1 billion cash commitment in Argo AI.
Argo AI plans to work closely with Ford and Volkswagen to provide the autonomous vehicle technology the automakers need to deliver fully integrated self-driving vehicles that can be manufactured at scale for safe, reliable and durable deployment in ride sharing and goods delivery services.
Based in Munich, Germany, AID will become Argo AI´s new European headquarters and will be led by AID’s current CEO Karlheinz Wurm. With the addition of AID employees, Argo AI will grow from 500 to over 700 employees globally.
In addition to its global headquarters in Pittsburgh, Pa., the new location marks Argo AI’s first engineering centre in Europe and the fifth globally in addition to Dearborn, Mich.; Cranbury, NJ; and Palo Alto, Calif. Collaborating with Ford, Argo AI also is testing its technology in Miami and Washington, D.C., where together they plan deployment of commercial services.
Ford plans to design an all-new, MEB-platform-based EV model, which starts arriving in 2023, in Köln-Merkenich, Germany. Volkswagen will supply MEB parts and components as part of the collaboration. Both companies also will continue to target additional areas where they can work together on electric vehicles – a key strategic priority for both companies as they drive to accelerate the transi- tion to sustainable and affordable mobility.
The agreement with Ford is a cornerstone in Volkswagen’s electric strategy, supporting the growth of the e-mobility industry and facilitating global efforts to reach the Paris 2050 Agreement.