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In January, Volkswagen and Ford had announced a global alliance. An alliance that would see a rare partnership between two of the world’s largest automakers, invest heavily on autonomous and electric vehicles. Today however, that partnership scaled to a different orbit altogether. Volkswagen has announced, that it will pump in an enormous $2.6 Billion into Argo AI, a startup (really?!?!?) developing autonomous vehicle tech, and mostly owned by Ford.

Argo AI is an autonomous vehicle startup that is based in Pittsburg. Two years ago it received a $1 billion booster from Ford, making the company a major stakeholder in return. Now, with VW investment, both car manufacturers will become equal owners of Argo AI.

VW will be contributing its Autonomous Intelligent Driving (AID) company worth $1.6 billion to Argo AI and remaining $1 billion in funding. With this deal, the valuation of the startup has exceeded $7 billion. Also, VW will be buying $500 million worth of Argo’s stocks in the next three years.

As a part of the Ford and VW alliance, the car manufacturers will be producing commercial pickups and vans. More precisely, Ford is to design and build medium-sized commercial pickups that would be sold by both manufacturers while VW will engineer a city van. Also, Ford will use VW’s new modular EV technology to build zero-emission vehicles. These vehicles will target the European market by 2023.

Now, with Argo AI being a part of this alliance, both car manufacturers plan to develop autonomous vehicles for US and European markets. With the inclusion of AID, which has 200 employees, Argo AI now expands into a 700 employees company.

“While Ford and Volkswagen remain independent and fiercely competitive in the marketplace, teaming up and working with Argo AI on this important technology allows us to deliver unmatched capability, scale, and geographic reach,” Ford CEO Jim Hackett said statement.

Argo AI has been testing its self-driving technology in Pittsburgh, Austin, Miami, Palo Alto, Washington, D.C., and Dearborn from the last two years.

Argo AI CEO, in a blog post said, “With Ford and Volkswagen as partners, Argo technology could reach nearly every global market and be applied across multiple brands and to a variety of vehicle platforms.”

Ford and VW aim to lower the costs involved in developing autonomous and electric vehicles by their global alliance. Now, with Argo AI becoming a part of this alliance, the joint venture is one step closer to their goal.