Ford and Volkswagen are extending their strategic alliance to co-develop electric vehicles and self-driving cars, the two manufacturers revealed late last week.

The companies have committed to spending billions of dollars developing the new-age vehicles, in a move they hope will ultimately cut manufacturing costs.

Ford and VW are already working together on commercial vehicles and mid-size pickup trucks as part of a broader effort in the industry to cope with more stringent regulation and fragmented markets.

Executives from each said the collaborations could save hundreds of millions of dollars in development costs for each company.

VW will stump up $4.4 billion into Ford’s Argo AI self-driving car, and estimates it could earn revenue of up to $28 billion by sharing its electric vehicle architecture with Ford in Europe.

Ford hopes that will enable to build at least one high-volume electric vehicle for sale in Europe starting in 2023 including one based on a popular Ford sports car.

It comes off the back of the 116-year-old company’s $711 million investment into an electric vehicle startup Rivian, with the intention of basing battery electric vehicles on the company’s so-called skateboard platform.

Major carmakers across the globe are making significant investments into electric vehicles, including BMW, Toyota and Nissan.

That is necessitating investment into battery metals in the mining industry, giving a boost to commodities such as lithium, cobalt, copper and nickel.

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