Ford, Volkswagen join forces

New York: Volkswagen and Ford are teaming up on a massive $7 billion project to attack the new frontier in the global auto market: electric and self-driving vehicles, the companies announced Friday.The German and US auto giants announced they were expanding their alliance, accelerating cooperation among otherwise competing global automakers as they face enormous costs in developing new technologies.

"It just makes sense for us. It makes both companies stronger," VW chief executive Herbert Diess told reporters. "It makes a lot of sense to combine forces."

Volkswagen will invest $2.6 billion in capital and assets in Ford´s self-driving unit Argo AI to market new-technology vehicles in the United States and Europe.

VW´s investment values Argo at more than $7 billion and will allow Ford to use VW technology to market "at least one" high-volume fully electric vehicle to European consumers starting in 2023. But this is not a merger or traditional corporate tie-up.

Ford chief Jim Hackett said that while the automakers "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."

He told reporters that Ford will take advantage of motors, batteries and other components VW developed to build a new electric model called ID.3 which is due next year with a starting price of 30,000 euros.