Volkswagen Group has boosted its planned investment in a joint venture with electric vehicle (EV) manufacturer Rivian Automotive, raising the deal to an estimated $5.8 billion, up from an initial investment plan of $5 billion. The partnership between Volkswagen and Rivian, set to launch on Wednesday officially, will see the first Volkswagen models incorporating Rivian’s software and electrical architecture as early as 2027.
The increased investment reflects both an acceleration of planned capital contributions from Volkswagen and structural changes to the deal, including expanded equity investment, as company officials noted during an investor call. Rivian’s stock responded positively to the news, climbing more than 6% in after-hours trading.
Oliver Blume, CEO of VW Group, emphasized during a press conference that the German automaker anticipates integrating Rivian’s technology across a variety of price points, markets, and brands worldwide. The rollout of Rivian’s software will start with Volkswagen, followed by Audi and Volkswagen’s forthcoming Scout brand, and may extend to other segments, including sports cars. While VW’s brand portfolio includes luxury brands like Bentley, Porsche, and Lamborghini, specific details on which brands would adopt Rivian’s technology were not disclosed.
Rivian CEO RJ Scaringe expressed excitement about expanding the reach of Rivian’s technology beyond its own vehicles, signaling a positive outlook for the joint venture’s potential.
While the current joint venture agreement primarily focuses on software and electrical architecture, both Scaringe and Blume clarified that any future collaborations, such as battery modules, vehicle production, or hardware sharing, would be separate from this deal.
The joint venture, named Rivian and VW Group Technology, LLC, is set to conclude its final agreements in the fourth quarter. Volkswagen has already invested $1 billion in the form of a convertible note and plans to add $1.3 billion at the joint venture’s official closing. This additional investment is structured to support background intellectual property (IP) licenses and secure Volkswagen a 50% equity stake in the venture. The remaining funds, totaling up to $3.5 billion, are expected to be contributed through equity, convertible notes, and debt by 2027, contingent on achieving specific milestones.
Announced in June, this partnership between Volkswagen and Rivian comes as Rivian aims to secure capital to support its expanding production lineup. The joint venture aligns with Rivian’s recent redesign of its vehicle models and its upcoming R2 series, scheduled for production in early 2026. Scaringe has previously noted that the funding from Volkswagen should support Rivian through its production ramp-up for the smaller R2 SUVs at its facility in Normal, Illinois, which is set to begin in 2026. The capital will also contribute to the development of a midsize EV platform at a new plant in Georgia, where Rivian had temporarily halted construction earlier this year.
The joint venture will be led by Rivian’s Chief Software Officer, Wassym Bensaid, and Volkswagen Group’s Chief Technical Engineer, Carsten Helbing. Teams of developers and software engineers from Volkswagen and Rivian will collaborate in Palo Alto, California, with additional sites under development across North America and Europe. The partnership aims to combine the technical strengths of Volkswagen and Rivian to create innovative software and electrical solutions for a broad range of EVs across global markets.
