Rivian-Volkswagen joint venture deal up to $5.8 billion

Rivian Automotive and Volkswagen Group have released details of their previously announced joint venture ahead of operations launching on Wednesday.

The companies in a joint press release Tuesday said the size of the deal is now up to $5.8 billion – up from the original $5 billion – with the first VW models using EV maker Rivian’s software and electrical architecture arriving as early as 2027.

Volkswagen is expected to use Rivian’s technologies “across a wide range of price points and international markets,” enabling advanced automated driving features and over-the-air updates and upgrades, the companies said.

“We’re excited to see our technology being integrated into vehicles outside of Rivian, and we’re excited about the future,” Rivian CEO RJ Scaringe said in a statement.

The name of the joint venture, which was expected to close during the fourth quarter, is “Rivian and VW Group Technology, LLC.”

The joint venture agreement was first announced in Juneand came as Rivian sought to raise additional capital as it launches its redesigned models and prepares for production of new “R2” vehicles in early 2026.

Scaringe previously said that the capital from VW is expected to carry the company through the production build-up of its smaller R2 SUVs at its plant in Normal, Illinois, starting in 2026, as well as production of a mid-size EV platform at a plant in Georgia, where Rivian put construction on hold earlier this year.

VW has already made an initial investment of $1 billion in the form of a convertible note, the companies said. Upon closing the joint venture, VW will invest about $1.3 billion “in consideration for background IP licenses and a 50% equity stake in the joint venture.”

The remaining investment of up to $3.5 billion is expected to come in 2027 “in the form of equity, convertible bonds and debt at future dates and based on clearly defined milestones,” according to the companies.

Rivian did not immediately respond to why there was an increase in the size of the deal to up to $5.8 billion.

The joint venture will be led by Rivian Chief Software Officer Wassym Bensaid and VW Group Chief Technical Engineer Carsten Helbing.

The companies said developers and software engineers from both companies will join the joint venture. Teams will initially be based in Palo Alto, California, with three other locations under development in North America and Europe.