Rivian Automotive and Volkswagen Group have announced an increase in their joint venture investment to a total of up to $5.8 billion. This reflects the companies' commitment to integrating Rivian's software and electrical architecture into Volkswagen's vehicle lineup.
The collaboration between Rivian and Volkswagen aims to integrate Rivian's technologies across various price points, international markets, and brands within the Volkswagen portfolio. The joint venture, named Rivian and VW Group Technology, LLC, is set to close in the fourth quarter of this year.
Volkswagen has already made an initial investment of $1 billion through a convertible note, with plans to invest an additional $1.3 billion at the closing of the joint venture. This investment will secure a 50% equity stake in the venture. The remaining investment of up to $3.5 billion is anticipated to be disbursed by 2027, contingent upon clearly defined milestones and will take the form of equity, convertible notes, and debt.
The integration process will begin with the Volkswagen brand, followed by Audi and the upcoming Scout brand. The collaboration will be led by Rivian's Chief Software Officer Wassym Bensaid and Volkswagen Group's Chief Technical Engineer Carsten Helbing.
The joint venture will have operations based in Palo Alto, California, with plans for additional sites in North America and Europe. The partnership will support Rivian in ramping up production of its redesigned models and preparing for the launch of its new "R2" vehicles in early 2026.
The collaboration between Rivian and Volkswagen highlights the growing importance of software and technology in the automotive market.