Volkswagen and EV company Rivian have entered into a new partnership, and the total value of the collaboration could reach $5 billion. The companies are launching a joint venture to develop platforms for “software-defined vehicles.” according to announced the deal, the joint venture’s work will focus on Rivia’s zone-based approach to electric vehicles, which significantly reduces the complexity of wiring and electronics. Both Rivian and Volkswagen are expected to debut vehicles using their combined forces as a result of the partnership; the release notes that each of the brands will continue to operate their automotive businesses separately.
The large dollar figure for this collaboration is broken down into components. Volkswagen is making a $1 billion base investment in Rivian the EV company, followed by two more expected investments of the same amount in 2025 and 2026. The automaker also expects to invest a total of $2 billion in the joint venture, some at launch and some as a loan in 2026.
This work will see Volkswagen adopt Rivia’s signature zonal architecture for its future cars. Today’s announcement follows the brand on many car models.
Rivian faced some financial difficulties this year, which led to the company For a plant in Georgia and of his salaried employees. A deal of this size with a leading traditional automaker should help stabilize the company in its business of electric cars.
