Still reeling from its latest round of financial losses, GM is exploring other options, including a partnership with Ford. Though neither company is revealing anything concrete, insiders are hinting at collaboration on powertrains and possibly GM licensing Chevy Volt technology.

A move like that could drive economies of scale for GM, bringing the Chevy Volt back into the threshold of affordability for mainstream America. Likewise, powertrains are a part of the vehicle not immediately apparent to consumers that require significant investment from automakers.

Supposedly GM initiated the talks, which initially received a lukewarm response at ford.

GM’s overture drew a mixed reaction inside Ford. Some executives felt that previous joint projects had benefited GM more than they had Ford, but others — including Ford’s global product development chief, Derrick Kuzak — saw it as an opportunity to leverage some of GM’s technology while at the same time reducing Ford’s own development costs, according to The Detroit News.

Last month though, the board of directors voted to proceed with the negotiations. The possible synergies have big implications, with the potential to save hundreds of millions of dollars. For example with powertrains, “splitting those costs with another car company can save an automaker $500 million. A new transmission can easily cost $800 million — or $400 million if the development costs are split.

Of course, Ford is also very “keen” to talk about licensing GM’s flagship green product: the Chevy Volt. And that should bring a grin to GM’s face as pulling more customers toward its technology will help it to establish dominance in the new energy-efficient paradigm.

Outside the Chevy Volt, Ford has experience in some areas GM can benefit from, including turbo-charging, direct injection and keeping production costs low.

A partnership between the two companies has the potential to provide economic advantages while also rallying support from traditional supporters looking to fulfill a sense of patriotism by spending dollars with American companies.

Related:

Entry was posted on Monday, August 4th, 2008 at 8:13 pm under Auto, Green Technology.

Read more entries by Matt Jansen.
Stumble It!