Following its investment in Xiaopeng, Volkswagen has invested in another new force, the American pure electric vehicle manufacturer Rivian.
It is reported that the two parties will jointly establish a joint venture, and Volkswagen plans to invest a total of US$5 billion in Rivian.
On February 22, 2024, local time, in Chicago, the United States, Rivian electric vehicles were driving in the factory.
The cooperation aims to accelerate the software development of Volkswagen Group and Rivian, and Rivian's technology will form the basis of future electric vehicle model software. After the establishment of the joint venture, Volkswagen will obtain the right to use Rivian's current electronic and electrical architecture and use it in Volkswagen's electric vehicles. In the future, the software technology of the joint venture will be widely used in the new models of both parties.
Oliver Blume, CEO of Volkswagen, said, “This partnership fits seamlessly into our existing software strategy. By working with Rivian, we will deliver the best solutions for our vehicles faster and at a lower cost.”
It is reported that the $5 billion that Volkswagen invested in Rivian will be injected into the company in batches. The initial investment is $1 billion, and Volkswagen will subscribe to convertible bonds worth $1 billion, which will not be redeemed for Rivian shares until December at the earliest. Next, Volkswagen plans to invest approximately $1 billion each in 2025 and 2026, followed by $2 billion in 2026. The subsequent $4 billion will be related to the joint venture that is expected to be established to jointly create electrification architecture and software technology.
Stimulated by the above news, Rivian's stock price soared by more than 50% at one point.
Volkswagen and Rivian are looking forward to a win-win alliance. Volkswagen, which is suffering from CARIAD, is in urgent need of software support, while Rivian needs money.
Rivian, known as a new American force, was founded in 2009 and listed on the Nasdaq in 2021. The latest financial report data shows that in the first quarter of 2024, Rivian produced a total of about 14,000 new vehicles and delivered about 13,600 vehicles. Revenue was US$1.2 billion, an increase of 8.15% over the same period last year; operating loss was US$1.484 billion; net loss was US$1.446 billion. In order to save itself, Rivian has gone through several rounds of layoffs.
After the announcement of the cooperation, Rivian CEO RJ Scaringe wrote that the investment will also help the company achieve positive cash flow growth. At the same time, it will also help them develop the R2 SUV scheduled to be launched in 2026 and the planned R3 crossover.
Currently, Rivian has only two models: the electric pickup truck R1T and the SUV model R1S, with the starting prices of the new models being US$69,900 and US$75,900 respectively.
