The Sharan was the Volkswagen-badged product from a joint venture between Volkswagen and Ford Motor Company to produce vehicles in the increasingly important MPV market, which was filled at the time by Renault's Espace and Chrysler's Voyager.[4] The resulting Volkswagen Sharan concept (and Ford Galaxy) was shown at the 1994 Paris Auto Show,[5]and production started in May 1995. The name Sharan was said to be derived from the Persian word 'Shahran' meaning "Carrier of Kings".[6] However, according to Volkswagen, it is a made-up word, like 'Touran'.[7]

Development began in top-secret in 1987, known only to the highest level members of the respective companies, with a team consisting of Ford's Steve Harper, Paul Coucill, and Volkswagen's Peter Knapp. Harper's design was chosen at the first review that September. It originally had a very different boxier design, and used a conventional minivan layout with a single sliding-door.