German car making giant Volkswagen has penned a deal to produce a pickup truck with US rival Ford, as discussions continue over extending an alliance between the two firms.
Volkswagen and Ford announced last year they were in talks to work on a range of commercial vehicles, later branching out even further to include electric and autonomous vehicles (EVs and AVs) as part of a partnership hoping to save billions in costs.
“We are in constructive talks about taking a stake in Argo, the Ford division for autonomous driving,” Volkswagen’s commercial vehicles chief executive Thomas Sedran said today.
“A joint company for offering mobility as a service is also a possibility,” he added.
Sedran added the discussions would last a few months.
Spokeswoman for Ford Jennifer Flake said the talks with Volkswagen were productive, but did not give any further indication of what they were discussing.
Argo AI, a Pittsburgh-based startup working on self driving cars, was bought by Ford in 2017.
But car makers have faced spiralling development costs for the new breed of vehicles in recent years, leading them to reach out to tech companies and partner up with one another in a bid to cut costs.
Volkswagen said it had signed a contract with the US firm to make a successor to its Amarok model pickup truck. Ford has a platform for its Ranger truck which could help lower development costs for the German manufacturer.