VW And Rivian Joint Venture Reignites EV Rumors: Scout Reboot And More
Volkswagen and Rivian just announced a joint venture to develop software-defined vehicle (SDV) platforms for future EV technologies. Both companies could then use the tech that comes out of this partnership on their respective models, allowing both to "combine their complementary strengths and lower cost per vehicle by increasing scale and speeding up innovation globally," according to their joint press release.
The primary purpose of the joint venture is for technological innovation, and Rivian and Volkswagen expect to release models that benefitted from this partnership to arrive in the latter half of the 2020s. Rivian will contribute its electrical architecture expertise to the collaboration and even license existing technologies to VW, allowing the latter to accelerate its EV technologies.
However, both companies will remain as separate entities, meaning Rivian won't be absorbed by Volkswagen. Despite that, VW is still one of the companies that own the top global car brands. The two companies expect the joint venture to become final in the fourth quarter of 2024.
A $5 billion investment
Alongside the joint venture announcement, VW also said that it plans to invest an initial $1 billion to Rivian, pending regulatory approval. Afterward, it will invest another $1 billion in 2025 and 2026, resulting in a $3-billion direct investment into Rivian's common stock.
The press release said that the remaining $2 billion will be invested in relation to the joint venture, with the release of funds divided between the project and as a loan that Rivian can tap into in 2026. Volkswagen said that it spent several months validating Rivian's expertise and ensuring compatibility with Volkswagen's models, so everything must have fallen in place, as the companies co-released the statement.
Many automobile enthusiasts will be excited about this news, as Volkswagen has previously announced its intention to revive the iconic International Harvester Scout as an electric SUV. The company plans to set up an independent U.S.-based company to build it, and a joint venture with Rivian might just be the start of this revival. However, nothing yet is set in stone — the press release says that everything is still subject to the completion of definitive agreements and regulatory approvals.