Reports of Volkswagen’s AV investment may be overblown.
- Source says the details around the investment have yet to be finalized
- Deal may get over the line by Summer 2019
- Ford to engineer vehicles for Volkswagen
Reports of Volkswagen’s $1.7 billion investment in Ford subsidiary Argo’s self-driving automotive technology may be premature.
A source familiar with the deal said that it is still in the early stages, and that the details around the investment have yet to be finalized.
“We don’t know the numbers, what the final deal will look like, or how it will be structured,” the source said.
The Wall Street Journal earlier this week reported that the German auto giant would invest $1.7 billion in Ford Motor Company’s Argo autonomous driving unit as part of a joint venture. As part of the deal, Volkswagen would provide $600 million as an equity investment, and an additional $1.1 billion in working capital for research and development. The journal also reported that the venture could also receive additional payments from Volkswagen.
We don’t know the numbers, what the final deal will look like, or how it will be structured.
Volkswagen did not immediately respond to questions regarding the journal’s report. Ford noted that its conversations regarding Argo were ongoing.
“Our talks with Volkswagen continue,” Ford said. “Discussions have been productive across a number of areas. We’ll share updates as details become more firm.”
The source said that there could be a formal agreement by this coming summer.
The automakers have been in discussions about the venture since last year. In early 2019, the pair announced that they had signed a memorandum of understanding to investigate collaboration on autonomous vehicles, mobility services and electric vehicles.
Ford also in January announced that it will engineer and build mid-sized pickup trucks for itself and Volkswagen, as well as large commercial vans for its European customers. Volkswagen plans to develop and build a city van.