The Alhambra was created under a technology sharing agreement between Ford and the Volkswagen Group, after the two companies found they were losing market share from the first generation of MPVs such as the Renault Espace and Mitsubishi Space Wagon. It shares most of its components and design with the Ford Galaxy and VW Sharan. This has led to the three vehicles being referred to collectively as the "Sharalaxy" or even "Shalambraxy". All three models were built on the same production line in Palmela, Portugal. Ford have now concluded their collaboration, and production of the Galaxy Mk III and the S-Max (a seven-seater based on the same platform as the Mondeo Mk IV) are built in Genk, Belgium, alongside the Mondeo. The plant VW plant in Palmela has been outfitted for the production of the VW Scirocco III.

It seats up to seven people — the 5 rear seats being all movable or even removable, leaving a flat-load floor. The Alhambra tends to have more options fitted for the same cost as its two other counterparts.