Ford, VW join forces with eye to the future

Ford Motor and Volkswagen have outlined what the companies hope will become a broad alliance — one that will hasten development of electric and self-driving cars and eventually cut costs.

But the initial step announced Tuesday, a plan to cooperate on pickup trucks and delivery vans, will do little to address the troubles both automakers face now. It also falls short of the restructuring plan from Ford that investors have been waiting to see for more than a year.

On the fringes of the North American International Auto Show in Detroit, Ford said it would develop and manufacture a compact pickup truck that the two companies may sell under their own names in South America, Africa and Europe. The truck will be based on the new Ford Ranger, which goes on sale soon. Ford will also produce a large delivery van and Volkswagen a compact van, both primarily for Europe.

Ford expects to save about $500 million a year, but not until 2023.

“We are forecasting the benefits at the end of our five-year period, so it is the 2023-2024 time frame mostly that the synergies start to accrue,” Ford’s chief executive, Jim Hackett, said in a conference call.

The companies said they were continuing to discuss ways to cooperate in the development of electric vehicles and self-driving technology, but stopped short of detailing how they might do that.

“It just makes sense to share investment, pool innovation capabilities and create scale effects in clearly defined areas,” said Volkswagen’s chief executive, Herbert Diess. “And that’s what we are going to do together with Ford.”

Rebecca Lindland, an independent auto consultant, said that many big auto alliances failed, but that those that prospered tended to start out small and expand slowly. “VW and Ford have a nice synergy with their customer base, so this limited partnership could be successful,” she said.

“Ford continues to frustrate investors by delivering piecemeal information on its future plans,” said Philippe Houchois, an analyst at Jefferies Securities. “We continue to see tremendous scope for improving Ford’s performance through its own restructuring and more extensive cooperation with VW.”