Volkswagen to invest up to $5 billion in electric vehicle maker Rivian in technology joint venture

SAN FRANCISCO (Reuters) – German automaker Volkswagen Group will invest up to $5 billion in U.S. electric vehicle maker Rivian in a new 50/50 joint venture to share electric vehicle architecture and software , the companies announced Tuesday.

Shares of Rivian jumped 30% in extended trading on the Nasdaq after the announcement, boosting 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 cheaper and smaller R2 SUVs, which are expected to go on sale in 2026, CEO RJ Scaringe told Reuters.

Volkswagen will initially invest $1 billion in Rivian and an additional $4 billion later, the companies said.

The partnership will help Volkswagen accelerate its software-defined vehicle (SDV) development plans, with Rivian licensing its existing intellectual property rights to the joint venture.

As electric vehicle startups grapple with slowing demand amid high interest rates and dwindling liquidity, traditional automakers are struggling 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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