SAN FRANCISCO (Reuters) – German automaker Volkswagen Group will invest up to $5 billion in U.S. electric vehicle maker Rivian as part of a new equally owned joint venture to share electric vehicle architecture and software, the companies said on Tuesday. fair.
Rivian shares rose 30% in extended Nasdaq trading following the announcement, increasing the company’s market value by more than $3 billion.
The investment will provide Rivian – known for its flagship R1S SUVs and R1T pickup trucks – with the funding it needs to develop its smaller, cheaper R2 SUVs, which are expected to launch in 2026, CEO RJ Scaringe told Reuters.
Volkswagen will initially invest $1 billion in Rivian and an additional $4 billion in investments later, the companies said.
The partnership will help Volkswagen accelerate its plans to develop software-defined vehicles (SDV), with Rivian licensing its existing intellectual property rights to the joint venture.
While electric vehicle startups have faced a slowdown in demand amid high interest rates and dwindling cash, traditional automakers have struggled to build battery-powered vehicles and advanced software.
(Reporting by Abhirup Roy in San Francisco; additional reporting by Noel Randewich; editing by Rod Nickel)
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