Volkswagen to Invest $1 Billion in Rivian; Plan to Launch Software Technology JV

Rivian Automotive and Volkswagen Group have announced plans to form an equally controlled and owned joint venture (JV) to create next-generation electrical architecture and software technology. As part of the strategic partnership, Volkswagen Group plans to make a $5 billion investment into Rivian.

The partnership is expected to allow both companies to combine their complementary strengths and lower cost per vehicle by increasing scale and speeding up innovation globally.

Rivian’s hardware design and integrated technology platform are expected to serve as the foundation for future SDV development in the JV that will be applied to both companies’ vehicles.

Rivian plans to contribute its electrical architecture expertise and is expected to license existing intellectual property rights to the JV.

The parties currently expect the completion of the JV formation in the fourth quarter of 2024. 

Both companies aim to launch vehicles benefiting from the technology created within the joint venture in the second half of the decade. In the short term, the joint venture is expected to enable Volkswagen Group to utilize Rivian’s existing electrical architecture and software platform. The partnership’s ambition is to accelerate Volkswagen Group’s SDV plans and transition to a pure zonal architecture. Each company will continue to separately operate their respective vehicle businesses.

Oliver Blume, CEO of Volkswagen Group, says: “Our customers benefit from the targeted partnership with Rivian to create a leading technology architecture. Through our cooperation, we will bring the best solutions to our vehicles faster and at lower cost. We are also acting in the best interest of our strong brands, which will inspire with their iconic products. The partnership fits seamlessly with our existing software strategy, our products, and partnerships. We are strengthening our technology profile and our competitiveness.”

RJ Scaringe, Founder and CEO of Rivian, adds: “We’re very excited to be partnering with Volkswagen Group. Since the earliest days of Rivian, we have been focused on developing highly differentiated technology, and it’s exciting that one of the world’s largest and most respected automotive companies has recognized this. Not only is this partnership expected to bring our software and associated zonal architecture to an even broader market through Volkswagen Group’s global reach, but this partnership also is expected to help secure our capital needs for substantial growth. Rivian was created to help the world to transition away from fossil fuels through compelling products and services, and this partnership is beautifully aligned with that mission.”

Rivian is an American automotive manufacturer that develops and builds category-defining electric vehicles and accessories.