Volkswagen pours billions in electric car manufacturer Rivian

It is anything but a secret that Volkswagen builds good cars, but has major problems with the software. Now an investment is supposed to help, as the Wolfsburg-based company is investing up to five billion dollars in the Californian electric car manufacturer Rivian.

Joint venture between Rivian and Volkswagen

One billion dollars will be the starting point, and over time the investment will increase to a total of up to five billion dollars. These are the key figures for a deal that can be described as a real bang in the industry. However, this is not a classic takeover, as Volkswagen and Rivian will establish a joint venture for this purpose, which will be owned equally by both partners.

From the perspective of the Wolfsburg-based company and officially also by Rivian, the aim of this joint venture is better software: “The partnership is intended to accelerate software development at the Volkswagen Group and Rivian,” the two carmakers said in a joint statement. “It is expected that both companies will be able to combine their complementary strengths and reduce costs per vehicle by increasing scale and accelerating innovation worldwide.”

For Volkswagen, this is another step towards eradicating the Cariad debacle. VW’s software subsidiary has been struggling with problems for many years, making this a weak point in Volkswagen Group vehicles. However, the results of the Rivian collaboration should be integrated directly into the work to date, promises Volkswagen CEO Oliver Blume.

Zone architecture

“The partnership fits seamlessly into our existing software strategy. This will strengthen our technology profile and our competitiveness,” said Blume. Rivian’s software is based on Tesla’s, which means that it uses a zone architecture that requires fewer electrical control units than usual.