Rolling in it! VW is investing $5bn in Rivian in exchange for help with its software

Volkswagen needs a little bit of help with its software. That’s been plainly obvious since it first launched the Mk8 Golf, and it now looks as though it’ll get that help from American EV startup Rivian.

Yep, the two companies announced today that they intend to form an equally controlled and owned joint venture that will eventually see the pair create “next-generation electrical architecture and best-in-class software technology”.

That next-gen architecture will apparently take the form of a new Software Defined Vehicle (SDV) platform and we’re told both companies aim to launch cars that benefit from that in the second half of this decade.

In the short term though, the venture will see Volkswagen making a $5bn (£3.95bn) investment into Rivian to boost the Californian company’s cash reserves as it plans to launch the recently unveiled R2 and R3 (pictured above). If the formation of the joint venture all runs smoothly, the investment will begin with $1bn later this year and will allow Volkswagen to use Rivian’s existing electrical architecture and software.

The recently updated Rivian R1T does rely on its screen for too many functions that’d be better served by physical buttons, but the whole system is a whole lot better than VW’s recent efforts.

“Our customers benefit from the targeted partnership with Rivian to create a leading technology architecture,” said Oliver Blume, CEO of the Volkswagen Group. “Through our cooperation, we will bring the best solutions to our vehicles faster and at lower cost. We are also acting in the best interest of our strong brands, which will inspire with their iconic products. The partnership fits seamlessly with our existing software strategy, our products, and partnerships. We are strengthening our technology profile and our competitiveness.”

Rivian founder and boss RJ Scaringe said of the deal: “We’re very excited to be partnering with Volkswagen Group. Since the earliest days of Rivian, we have been focused on developing highly differentiated technology, and it’s exciting that one of the world’s largest and most respected automotive companies has recognised this. Not only is this partnership expected to bring our software and associated zonal architecture to an even broader market through Volkswagen Group’s global reach, but this partnership also is expected to help secure our capital needs for substantial growth.”