Volkswagen confirms joint development with Ford

VW Group CEO Herbert Diess has announced that it has joined hands with Ford to jointly develop commercial vehicles, along with having "identified other potential cooperation".

Confirmed at the German carmaker’s annual board meeting press conference, the announcement has quashed rumours of a VW and Ford tie-in that had been circulating since the start of the month. Speculation had suggested that the brands will also develop electric vehicles together.

However, Diess denied the rumours of a full merger with Ford, claiming "that was never the objective of our talks".

At the conference, Diess also revealed the Group has increased its five-year investment into electric vehicles, autonomous and connected technology from €34 billion (Rs 2,77,032 crore) to €44 billion (Rs 358,512 crore), around a third of the carmaker's total expenditure for the period. Of that sum, €30 billion (Rs 2,44,440 crore) will be put into electric mobility, including everything from platform and powertrain development to infrastructure investment.

He also sees "few reasons" why the majority of car buyers won't be going electric by 2020, claiming "for those who drive less than 30,000km a year, electric will be their first choice".

Plans to improve production efficiency, essential in the cost-cutting aftermath of Dieselgate, by 30 percent by 2025 were also discussed.

VW Works council head Bernd Osterloh discussed the brand's desire to be "part of battery manufacturing close to where the cars are produced". Diess added that it "doesn't make sense" to spread EV production across Europe. VW's current trio of dedicated electric vehicle plants across Germany is claimed to be the largest network of EV production across Europe.

Despite the continued focus on electrification and future mobility services, the brand confirmed that internal combustion engines "will remain important" for several years. "We will offer diesel engines with reduced NOx and carbon levels", Osterloh confirmed.

LAWRENCE ALLAN