Ford and Volkswagen have said they are exploring a strategic alliance to look at jointly developing a range of commercial vehicles.

Both have signed a  Memorandum of Understanding aimed at strengthening their competitiveness, but there are few details at this stage to shed light on what that could mean.

The potential alliance would not involve equity arrangements, including cross ownership stakes.

Jim Farley, Ford’s president of Global Markets, said: “Ford is committed to improving our fitness as a business and leveraging adaptive business models – which include working with partners to improve our effectiveness and efficiency.

“This potential alliance with the Volkswagen Group is another example of how we can become more fit as a business, while creating a winning global product portfolio and extending our capabilities."

Dr. Thomas Sedran, head of Volkswagen Group Strategy, said: “Markets and customer demand are changing at an incredible speed. Both companies have strong and complementary positions in different commercial vehicle segments already.

"To adapt to the challenging environment, it is of utmost importance to gain flexibility through alliances. This is a core element of our Volkswagen Group Strategy 2025. The potential industrial cooperation with Ford is seen as an opportunity to improve competitiveness of both companies globally.”

The companies will provide updates and additional details as talks progress.