VW and Ford set to collaborate on autonomous future

In a world in which we no longer drive ourselves, where our cars are more like trains, will we need so many different brands to choose between? Can they all survive, or will the big marques fold into one another, leaving just a few giant players standing?

It certainly seems possible when you consider that two titans of the industry, Volkswagen AG and Ford Motor Co. are well on the way to an agreement to join forces to build autonomous cars.

Bloomberg has reported that talks between the two companies over the plan, after initially stalling, are now progressing well, with the breakthrough being a possible framework that would allow VW to work with and invest in Argo AI, the Ford-backed self-driving-car start-up.

While the talks are high level and private, sources have been leaking the news that the two companies have discussed a valuation for the joint company of $US4 billion.

Officially, a VW spokesman told Bloomberg his company is in “constructive talks” with Ford, while a spokeswoman for the American giant said discussions were ongoing and had been productive.

The deal would build on an agreement signed between the two in January to build commercial vehicles together. What price an eventual merger?

At the very least, a joint venture on autonomous tech between the world’s largest car company and Ford would create a seemingly unbeatable colossus in the race to dominate the self-driving market, dwarfing even Google/Alphabet’s Waymo, and GM’s Cruise unit.

Ford CEO Jim Hackett has already said he believes the market will one day be worth $US10 trillion. This really could be the future of everything, and not every company will get there.

Ford would bring the self-driving software it has been developing to the table.

“There’s not going to be 10 winners in this space when we look back,” Hackett has said. “There’s going to be a few, and we plan on being one of them.”

While Ford would bring the self-driving software it has been developing to the table - which would then be equally owned by the two companies - VW will being its electric-vehicle technology to the bargain, creating a formidable combination of IP.

“The fact is, nobody can go it alone,” said industry analyst Michelle Krebs.

“These are very expensive ventures with tremendous technological challenges. And the business challenge is just as difficult.”

Are you ready to embrace a driverless 'driving' future? Tell us what you think in the comments below.