Analysis: Why car makers are casting aside old rivalries

Car makers have a choice. Spend a fortune on a dedicated EV platform that reduces complexity, offers advantages like extra cabin space and might save money later. Or develop a platform that saves money by being flexible enough to incorporate all drivetrains but is ultimately compromised. 

The Volkswagen Group is gambling that the expense of creating the MEB electric car platform will be recouped by supplier and manufacturing efficiencies, offsetting the huge cost of the batteries. That gamble relies on the Volkswagen Group achieving its predicted annual sales of over a million via its brands in only a few years. “The risks attached to this are huge, in our view,” Max Warburton, an analyst at Bernstein, wrote in a recent report. “VW has the potential to lose significant amounts of money.” 

Having Ford as a customer will cut those risks. Even better is to split those risks with a partner, as Toyota is doing with Subaru and Mazda. 

Would the customer even notice all these shared parts? Unlikely, reckons Urquhart. “People are increasingly not going to care what’s underneath any more,” he said. “Exterior style, the latest infotainment, self-driving technology – all these will be more important to them,” he said. 

If car makers are not going to end up as merely hardware providers to Google, Apple or whatever tech company comes along next to transform the driving experience, they need all the money they can get to develop this tech themselves.