Barring a last-minute hitch, two of the world's largest automakers plan to announce a far-reaching alliance shortly after the new year, one that will cover a wide swath of territory and a broad range of technologies, new and old.
The deal will serve as something of a jointly played jigsaw puzzle, allowing Ford Motor and Volkswagen to leverage their strengths and offset weaknesses at a time when the global automotive industry is facing not only traditional competitive challenges but the risks posed by massive technological transformation. Among the key elements expected to be part of the deal will be a cooperative effort to bring to market electrified and autonomous vehicles, something each of the companies already has spent billions of dollars developing.
"We are in quite advanced negotiations and dialog with Ford to really build up a global automotive alliance, which also would strengthen the American automotive industry," Volkswagen CEO Herbert Diess told reporters in Washington, D.C. after meeting with President Donald Trump earlier this week, offering the most substantial comment on the carmakers' negotiations yet.
The meeting, which included other European auto executives such as Daimler CEO Dieter Zetsche, was aimed at easing trade tensions that have seen Trump threaten to impose major new tariffs aimed at restricting access to the American market by European automakers.
Diess noted that he had told the president VW is"considering building a second car plant" that would supplement the automaker's existing facility in Chattanooga, Tennessee that has already doubled in size since opening in 2011.
But there appear to be other options Volkswagen is considering as it moves forward with talks with Ford. That includes the possibility of taking over one of the American company's existing, underutilized assembly plants. It is also possible, several sources close to the talks have hinted, that VW could wind up sharing more than one plant with Ford.