It appears that Volkswagen and Ford are in “exploratory talks” over the possibility of jointly developing self-driving and electric vehicles. A person familiar with the matter told Reuters that the far-reaching strategic alliance is meant to save the companies billions of dollars, and an update on the progress is expected to be announced before the end of the year.

Not much about the venture is known at this point – spokesmen for both automakers would only reiterate what they have said before about the companies collaborating on the development of commercial vehicles. Both Ford and VW are already part of the joint-venture company IONITY, which is developing a high-powered charging network for EVs across Europe.

The report added that both carmakers are under pressure to roll out more EVs in Europe, where emissions rules are becoming increasingly stricter following the entire Dieselgate scandal.

Volkswagen’s CFO Frank Witter, on the other hand, said the company was open to deeper alliances with outside companies, particularly in the area of autonomous driving. He added that it’s theoretically possible to share its MEB platform for electric cars with Ford, but its present focus will be on rolling out its EV technologies among brands within the VW Group.

Meanwhile, VW Group is investing 34 billion euros (RM161.6 billion) into e-mobility and autonomous driving by 2022 and plans to make around two to three million battery electric vehicles (BEV) by 2025. Its MEB project already includes 50 billion euros (RM237.7 billion) being pumped into battery cell procurement by 2025.

Several Volkswagen officials have emphasised that the only way to make EVs a mass market product is through economies of scale, which would make them as cheap, if not cheaper than diesel vehicles.

Ford’s plans to go green also includes a recent investment of US$4 billion (RM16.7 billion) into its self-driving vehicle operations, and the company is still seeking external investors to expand the division. In the future, the Blue Oval will invest another US$4 billion through 2023 in its newly formed Ford Autonomous Vehicles, including the US$1 billion (RM4.18 billion) it previously had earmarked for Argo AI, the Pittsburgh-based self-driving startup that Ford acquired in 2017.