VW, Ford will definitely build a pickup truck together

Volkswagen has signed a deal to develop a pickup truck with U.S. rival Ford and continues discussions about extending its alliance to include autonomous driving and mobility services, the German carmaker said on Thursday.

In June, VW and Ford said they were in talks to develop a range of commercial vehicles, later extending the discussions to include electric and autonomous cars as part of an alliance designed to save billions in costs.

"We are in constructive talks about taking a stake in Argo, the Ford division for autonomous driving. A joint company for offering mobility as a service is also a possibility," Volkswagen's commercial vehicles chief executive Thomas Sedran said on Thursday.

The talks will conclude in the coming months, Sedran said.

Ford spokeswoman Jennifer Flake said the discussions with Volkswagen were productive but declined to discuss further details.

Ford bought Argo AI, a Pittsburgh-based self-driving startup, in 2017, but with spiraling development costs for autonomous cars in recent years, the company and other carmakers have sought alliances and outside investors.

VW said it has signed a contract with Ford to develop a successor to its VW Amarok pickup truck. Ford has a platform for its Ranger midsized pickup truck, which could help VW lower development costs.