(Bloomberg) — Volkswagen AG and Rivian Automotive Inc. have cited leaders for their multi-billion dollar joint venture and showcased a prototype electric car, signaling their commitment even as global demand for electric cars declines and the incoming Trump administration threatens supportive policies to limit.
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The two companies agreed in June to jointly develop battery-powered vehicles, with VW expected to invest as much as $5 billion in Rivian. On Tuesday, VW increased its investment plans by another $800 million. That financial lifeline could ease concerns about Rivian’s cash burn and give the German automaker access to its U.S. partner’s software technology — an area where VW has stumbled.
Shares of Rivian rose 3.7% to $10.97 in postmarket trading as of 4:29 p.m. in New York. The stock closed regular trading Tuesday down about 55% this year.
The joint venture, known as Rivian and VW Group Technology LLC, will be led by co-CEOs Wassym Bensaid, Rivian’s chief software officer, and VW’s chief technology officer Carsten Helbing, the companies said in a joint statement. The co-CEOs will lead a dedicated group of approximately 1,000 engineers from both companies.
“This is an acceleration of our plans for the future,” Bensaid said in an interview at Rivian’s Palo Alto office.
Volkswagen aims to launch vehicles whose technology has been refined by the joint venture in 2027. The companies also want to develop an entirely new, software-defined vehicle with more advanced technologies, which they plan to eventually license to other automakers.
The prototype shown to a small group of reporters in Palo Alto integrates Rivian’s software-based vehicle architecture into an unmarked VW test vehicle, which Bensaid said was outfitted by the JV’s engineers over a twelve-week period.
Helbing, who will also serve as the company’s chief operations officer, said the technology will be easily translatable to commercially available Volkswagen models at a similar pace. He added that this type of accelerated decision-making and development time is an added benefit of working with a smaller and nimble partner like Rivian.
“For us, the impressive part was the speed and pace of the implementation,” Helbing said in the interview. “The idea is to maintain the pace.”
Bensaid said Rivian sees the venture as a way to increase cost savings by leveraging the economies of scale of its larger partner, thereby improving margins on its own vehicles.
