Vehicle manufacturers Rivian and Volkswagen outline joint electric vehicle technology platform worth $5.8 billion
Volkswagen Group and Rivian have announced a groundbreaking joint venture worth $5.8 billion, aimed at developing next-generation electric vehicle (EV) technology. The partnership focuses on a global software and electrical architecture for EVs, with Volkswagen investing $1 billion in Rivian as part of their broader technology-sharing deal.
The joint venture, named Rivian and Volkswagen Group Technologies, is scheduled to commence operations on November 13. The teams will be based in Palo Alto, California, with additional R&D sites in North America and Europe.
For Rivian, this joint venture marks a significant milestone in the company's mission to accelerate EV adoption worldwide. Their R2 SUV, a midsize vehicle targeted at a price of around $45,000, is a critical element of this strategy. Production is expected to start in 2026, with preparatory work already underway at their Illinois facility.
The joint venture aims to reduce Rivian's operational costs, helping to lower the company's high cash burn rate and achieve a target gross margin of 20% by 2027. Volkswagen brings critical supply chain and research and development support, enhancing economies of scale.
Volkswagen Group CEO Oliver Blume views the partnership as a "natural step" in VW's software ambitions. Co-CEO Carsten Helbing notes that the team is working hard to redefine what's possible when a legacy brand and a next-gen automaker combine their strengths.
The technology developed by the joint venture will be applied to vehicles ranging from compact city cars to luxury models. A drivable demo vehicle has already been built, showcasing the scalability and flexibility of their combined technology.
However, the partnership presents complex intellectual property management challenges for Volkswagen, given their other simultaneous EV projects. VW is collaborating with Rivian on software and electrical architectures, while also managing technology partnerships with other companies such as Xpeng in China.
Rivian's founder and CEO RJ Scaringe sees the collaboration as a leap forward in the company's mission and focus on creating products that benefit customers and drive the industry forward. For Scaringe, the joint venture is a significant step towards Rivian's goal of becoming a leading player in the EV market.
Volkswagen's first models under the joint venture are planned to hit the market as early as 2027. The joint venture isn't just about creating vehicles; it's about crafting a flexible and scalable EV platform that will shape the future of both Rivian and Volkswagen's EV lineups.
- The joint venture, Rivian and Volkswagen Group Technologies, will be based in Palo Alto, California, with additional R&D sites in North America and Europe, working toward the development of scalable and flexible electric vehicle (EV) technology.
- The partnership between Volkswagen Group and Rivian is set to commence operations on November 13, with Volkswagen investing $1 billion in Rivian as part of their broader technology-sharing deal.
- For Rivian, the joint venture is a significant milestone in their mission to accelerate electric vehicle (EV) adoption worldwide, with their R2 SUV, targeted at around $45,000, being a critical element of this strategy.
- The technology developed through the joint venture will be applied to various vehicles in the industry, including compact city cars and luxury models, and a drivable demo vehicle has already been built to showcase its scalability and flexibility.
