Volkswagen Group Expands Investment in Joint Venture with Rivian Automotive
Volkswagen Group has announced an increase in its planned investment in a joint venture with electric vehicle maker Rivian Automotive. The companies revealed the expansion of the deal, now totaling $5.8 billion, ahead of the joint operations launching on Wednesday. This marks a significant increase from the initial investment of up to $5 billion.
The first Volkswagen models utilizing Rivian’s software and electrical architecture are set to debut as early as 2027. The partnership aims to leverage Rivian’s cutting-edge technologies across various price points, international markets, and brands within the VW Group portfolio. Shares of Rivian surged by more than 6% during after-hours trading following the news.
VW Group CEO Oliver Blume emphasized the strategic integration of Rivian’s software, initially focusing on the Volkswagen brand before expanding to Audi and VW’s upcoming Scout brand. The potential inclusion of Rivian’s technologies in sports cars was also hinted at, highlighting the partnership’s broad scope across VW Group’s lineup, which includes Bentley, Porsche, and Lamborghini.
Rivian CEO RJ Scaringe expressed enthusiasm about the collaboration, noting the future potential of their technology being integrated into vehicles beyond Rivian’s own lineup. Both leaders stressed that any additional plans like joint vehicle production, battery modules, or hardware component sharing would be separate from the established joint venture agreement.
The joint venture, named “Rivian and VW Group Technology, LLC,” is expected to finalize by the fourth quarter. The agreement builds upon VW’s initial $1 billion investment in the form of a convertible note, with an additional $1.3 billion to be invested at the venture’s close. The remaining $3.5 billion will be injected by 2027 via equity, convertible notes, and debt, subject to defined milestones.
The partnership was initially announced in June, aligning with Rivian’s capital-raising efforts as it gears up for the production of new models and redesigned vehicles. The joint venture will be overseen by Rivian’s Chief Software Officer Wassym Bensaid and VW Group’s Chief Technical Engineer Carsten Helbing, with joint teams based in California initially, and expansion planned in North America and Europe.
The enhanced investment signifies a deepening collaboration between Volkswagen Group and Rivian Automotive, signaling a significant step in advancing electric vehicle technology and market presence. This innovative partnership is poised to make a lasting impact on the automotive industry and shape the future of sustainable mobility.
