Industry News: Ford-Volkswagen Expand Collaboration as Ford Plans All-Electric Future for Europe by 2026

David · March 14, 2022

2019, Volkswagen CEO Dr. Herbert Diess and Ford President and CEO Jim Hackett form a partnership that covers the following:

Volkswagen to join Ford in investing in Argo AI, the autonomous vehicle platform company, at a valuation of more than $7 billion. Tie-up allows both automakers to independently integrate Argo AI’s self-driving system into their own vehicles, delivering significant global scale
Ford will use Volkswagen’s electric vehicle architecture and Modular Electric Toolkit (MEB) to design and build at least one high-volume fully electric vehicle in Europe for European customers starting in 2023, more efficiently advancing its promise to deliver expressive passenger cars while taking advantage of Volkswagen’s scale
Ford and VW on track to develop commercial vans and medium pickups for each brand in select global markets starting in 2022; sharing development costs to generate significant synergies
The Volkswagen-Ford global alliance – which does not involve cross-ownership between the companies – is expected to create annual efficiencies for each company

Volkswagen committed to their MEB platform in 2016 with a goal of producing 15 million EVs over the next Decade globally. Ford committed to having an EV available to European customers by 2023 that would deliver more than 600,000 EVs built on the MEB platform. Volkswagen has become a platform supplier to other auto companies.

The flip side of this agreement is that Ford starting in 2022 would build medium sized pickup trucks for both companies that will be sold in Europe, Africa, Middle East, Asia Pacific and South America. Ford would engineer and build large commercial vans for European customers for both companies as Volkswagen would engineer and build city vans for both companies sold in Europe and select global markets where both companies can better utilize plant capacity allowing both companies to compete globally.

2022, March 14th, 2022, officially Pi Day around the world and both companies have agreed to expand their e-mobility partnership.

Ford will produce a second electric model on the MEB platform
Over the next 6 years, Ford will now produce 1.2 million units rather than 600,000 originally stated.

Quote: Stuart Rowley, Chair of Ford of Europe: “Our strategic alliance with Volkswagen is an important element of Ford’s commitment to offer an all-electric range of vehicles that are uniquely Ford and designed to meet the mobility needs of a modern Europe that is leading the fight against climate change.”

Volkswagen as they expand their partnership with Ford is working to take one step closer in becoming a global platform supplier for EVs as a further pillar in addition to their core business. MEB platform can be used by various brands/manufacturers as it already provides the technology base for 10 electric models from five brands globally. The MEB platform was used to produce approximately 300,000 units in 2021, making it one of the leading electric platforms worldwide. This platform is not only used by Volkswagen in their building of the extensive ID. series of EVs, but in use of commercial vans and other segment vehicle types allowing for utilization of economies of scale worldwide.

To quote Thomas Schmall: “Profitability and speed are now crucial for finally achieving the breakthrough of e-mobility in Europe.”

This leads us to today's major announcement from Ford:

Fords plan for Europe by 2024:

Ford to introduce three new electric passenger vehicles and four new electric commercial vehicles in Europe by 2024; plans to sell more than 600,000 electric vehicles in the region by 2026
EV push in Europe supports the acceleration of the Ford+ plan, and global goal of 2 million+ annual production of EVs by 2026 and 10% company adjusted EBIT margin by 2026
Planned production of electric vehicles in Cologne, Germany, now expected to be 1.2 million vehicles over six years, with a total product investment of $2 billion
Additionally, Ford today signed a non-binding MOU with SK On Co., Ltd. and Koç Holding to create one of Europe’s largest commercial vehicle battery production sites in Turkey
Boosts electric and commercial vehicle capacity, with Ford Otosan JV assuming ownership of Ford’s Romanian manufacturing operations, subject to regulatory approval and consultation
Together, these initiatives will help Ford achieve zero emissions for all vehicle sales and carbon neutrality across its European footprint of facilities, logistics and suppliers by 2035

The drive of Ford European business is that in 2021, sport utilities and crossovers accounted for 58% of all Ford passenger vehicles sold in the continent, up 20% from 2020. The first all-electric five-seat, medium-sized crossover will come out of Ford Cologne Electrification Center. The name will be revealed later in 2022 along with more details and having a driving range of 500km (311 miles) on a single charge with production commencing in 2023.

Batteries have been a big issue for any auto company as they move forward in transition from ICE to BEV. To accomplish this, FORD in supporting their ambitious EV plans for electrification have signed a non-binding memorandum of understanding for a new, industry leading joint venture business in Turkey with SK On Co, Ltd. and Koc Holding to build on of the largest battery facilities in the European region. These will be high Nickel NMC cells with a likely production of 30 to 45 Gigawatt hours. This plant is a three-partner battery joint venture which includes support from the Turkish Government.

Ford continues the growth of Europe by stating that their manufacturing plant in Craiova, Romania will play a significant role in both retail and commercial vehicle growth plans for Europe.

2024 Ford's most popular ice compact crossover will get a pure electric version allowing an even wider group of European customers to experience Ford autos. As the Puma will have both ICE and EV, the next all-new generation of the Transit Courier will go into production in both retail and commercial form in both ICE and EV with ICE production starting 2023, EV starting 2024 both produced in Craiova.

This plan allows Ford to achieve their goal of an all-electric global portfolio and carbon neutral by 2035.

Leading the Electric Vehicle Revolution (ford.com)

Ford plans to have across 10 plants, 240 Gigawatt of battery cell capacity by 2030. Approximately 140 Gigawatts will be required in North America, the rest dedicated to Europe and China.

Ford - Volkswagen expand their global collaboration to advance autonomous driving, electrification and better serve customers | Ford Media Center

Volkswagen and Ford expand collaboration on MEB electric platform | Volkswagen Newsroom (volkswagen-newsroom.com)

Ford Takes Bold Steps Toward All-Electric Future in Europe; 7 New Connected EVs Support Plans to Sell 600K+ EVs Annually by 2026 | Ford Media Center

Ford, SK and Koç Set to Create a Joint Venture to Accelerate Ford’s Electrification Revolution in Europe | Ford of Europe | Ford Media Center

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