Ford and Volkswagen confirm development alliance

Carmakers Ford and Volkswagen announced an alliance on Tuesday that is aimed at reducing their costs in the face of slowing sales.

Ford’s chief executive Jim Hackett said at the Detroit auto show commented on the alliance that would have the companies work together in the development of commercial vans and mid-size pickups and also share resources on autonomous vehicles, electric cars and mobility services.

The companies estimate the collaboration will yield improved annual pretax operating results starting in 2023, Reuters reported.

“Over time, this alliance will help both companies create value and meet the needs of our customers and society. The deal will give the companies the opportunity to collaborate on shaping the next era of mobility”, Hackett said.

Ford and VW signed a memorandum of understanding last June to explore the possible collaborations.

The car industry has been hit hard by falling sales recently, due to the general slowdown in the Chinese market and the harsh sanctions implemented on diesel vehicles.