Earlier this month Ford and Volkswagen made headlines in auto industry news outlets after reports surfaced about the two companies working on ways to complement each other through collaboration agreements, starting off with commercial vehicles.
Several analysts consulted by the Detroit Free Press, the city’s largest newspaper, made the case of how little the portfolios and business models of each company overlap on the other and how much sense it makes for them to work together.
For instance, Ford is one of the biggest players in the pickup truck segment and overall in the U.S. market, while Volkswagen’s reach is very modest on both. Meanwhile, Volkswagen is very competitive in South America, China and Europe, where Ford has been struggling for years to succeed.
But what seemed to be a partnership primarily focused in jointly development and production of commercial vans has now “broadened to include potential collaboration on autonomous driving and arrangements to make vehicles for one another,” Bloomberg reported.
Although Bloomberg does not get into the specifics of the potential partnership, the report notes that Ford’s CEO Jim Hackett hinted about the talks and their progress during the company’s earnings call last week.
“We look forward to sharing more about this global redesign of the company. We are going to be coming to you more frequently, including we’re going to talk about these strategic partnerships in the near future,” he said.
However, a company official that actually went on record with Bloomberg to make clear how serious both Ford and Volkswagen are into the talks. “Collaboration isn’t being limited in any way whatsoever, whether it’s different types of technology, product segments or geography,” said Ford Chief Financial Officer Bob Shanks. “We’re having a very broad set of discussions about how we can help each other around the world.”
Although the talks are far from over it’s worth recalling the assets that both companies operate in Mexico.
In the state of Puebla, Volkswagen owns what many say is the company’s largest assembly facility outside Germany. The Puebla plant builds Jetta sedans, second generation Tiguan SUVs, several Golf variants and the Beetle coupe. Production of the last two models, however, is slated to cease in 2019 to make room for a new SUV which will start to roll out of the facility in 2020.
The German automaker also operates an engine production facility in Silao, Guanajuato. Volkswagen plans to double production capacity at this plant by 2020 to 700,000 engines per year.
Meanwhile, Ford owns an assembly facility in Hermosillo, Sonora which builds Ford and Lincoln sedans, although several reports have pointed out that the plant will shift towards production of crossovers in the near future.
Another plant located in Cuautitlan Izcalli, State of Mexico builds the Ford Fiesta in sedan and hatchback versions. However, production of the Fiesta is also slated to end in 2019 for the facility to be retooled to build electric vehicles.
Ford also operates an engine manufacturing complex in the city of Chihuahua which comprises of three plants and a transmissions production facility in the city of Irapuato, Guanajuato.