Ford, GM announce $720M deal

By John Porretto
Associated Press

Mario Gatto of General Motors' Warren Transmission Plant takes a closer look at a 6-speed, front-wheel-drive transmission after its unveiling yesterday in Warren, Mich. "Six-speeds are the future," said Ford's Dave Szczupak. Associated Press

"Six-speeds are the future," Dave Szczupak, Ford's vice president for powertrain operations, said yesterday. "They help to optimize power, smooth operation and fuel economy."

Taking on such a project alone would cost as much as $1 billion, said Tom Stephens, GM's group vice president for powertrains. By working together, Ford and GM will reduce the development time by several months and save millions of dollars, he said.

The front-wheel-drive transmission is expected to offer an estimated 4 percent improved fuel economy over traditional four-speed transmissions in front-wheel-drive cars.

Under a memorandum of understanding signed in October 2002, Ford and GM agreed to cooperate on designing, engineering and testing the new transmission as well as working with suppliers to develop and buy components.

The new gearbox will be used in cars and sport utility vehicles. Production is scheduled to begin at both companies in 2006.

Six-speed automatic transmissions are installed in less than 1 percent of vehicles sold today in North America, Szczupak said. Because of their potential for smoother driving and fuel efficiency, such engines will likely be found in roughly 15 percent of passenger vehicles by 2010 and about half of all vehicles by 2015, he said.

GM is investing $350 million and Ford is investing $370 million to build the transmission. It will be manufactured separately at GM's Warren transmission plant and Ford's transmission plants in Sharonville, Ohio, and Sterling Heights.