The deal is sealed

VW invests 6 billion dollars in loss-making company Rivian

(Bild: Rivian)

The deal is in the bag: VW will be working with Rivian on the development of future electric cars. An agreement worth almost six billion dollars has now been officially sealed. The first cars from the partnership are due to be launched on the market in 2026/27.

VW and the US electric car manufacturer want to jointly develop key technologies for electric cars in the future. As part of a joint venture that has already been officially launched, the Germans plan to invest up to 5.8 billion US dollars (around 5.5 million euros) in their former rival by 2027.

The German group has already made an initial investment of one billion US dollars in the form of a convertible bond. For VW CEO Oliver Blume, the partnership is "the next logical step to strengthen VW's global competitive and technological position".

Rivian contributes electric architecture
As part of the joint venture, employees from both companies will form teams at four locations in the USA and Europe to jointly develop next-generation electric architecture and software technologies for future electric cars from both companies. The electric and software architecture already developed by Rivian will serve as a starting point. This area is one of VW's biggest construction sites.

The jointly developed architecture should be applicable in all relevant segments, including small cars. As part of the joint venture, the Rivian R2 compact SUV will initially be developed for series production by 2026 on the basis of the US partner's existing electric architecture and software technology. The first electric cars from the VW Group with the technology developed jointly with Rivian are expected in 2027.

VW promises a modular and flexible electronics architecture that can be used in many price classes and on international markets. It should enable automated driving at a high level and be updateable and upgradeable over the air (OTA). According to VW, a demonstrator based on VW series technology that can drive with Rivian's integrated technology platform has already been realized within three months.

Software not yet Volkswagen's strong point
VW has been struggling for years with problems in its in-house software development for electric cars, which has already delayed model launches. Scaringe put his finger on the problem on Tuesday. In recent years, it has been recognized that established manufacturers have difficulties with their own software.

According to media reports, VW's investment in Rivian also heralds the end of its software subsidiary Cariad. The software for the Group's new vehicles was actually supposed to be developed there.

SUVs, pick-ups and electric delivery vans
Rivian delivered almost 13,600 electric cars in the last quarter, making a turnover of 1.2 billion dollars and a loss of 1.45 billion dollars. The company is active in two popular vehicle categories in the USA: large SUVs and pick-ups. Rivian also builds electric delivery vans for Amazon, which can now also be seen in Europe. The world's largest online retailer is also an investor.