Volkswagen and Ford are getting closer to a deal

Volkswagen AG is close to making a deal with Ford Motor. The two companies are looking for a common path in developing technologies for electric and stand-alone vehicles. The initiative is a German carmaker, and the company's goal is to speed up the process of technological transformation.

It seems the negotiations with Ford are going well and are on the brink of finalization. The new pact with the US company already includes the joint development of pickups and buses, which is part of VW's big plan to reduce costs and counteract sales delays.

Exiting the US market will increase the company's resilience to trade strain and ever-tightening rules for carbon emissions. The company has already responded to this threat with several initiatives. These include the sale of secondary divisions and assets, mainly in the production of ship engines and the partial IPO of Traton SE - the VW heavy truck division.

Volkswagen encounters major difficulties in China, which is the company's largest market. The trade conflict has severely hit the company's sales and production capabilities in China.

Bonding between VW and Ford is likely to lead to investment in the state-of-the-art auto software development company, Argo AI. The deal can be announced as early as July. Such a partnership would be direct competition against Alphabet and Waymo, as well as General Motors and Cruise.

Source: Bloomberg Finance L.P.

Photo: Flickr

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