Rivian-VW Joint Venture Announcement

Investing.com — Rivian Automotive has announced a joint venture (JV) with Volkswagen (ETR:VOWG_p) Group, marking a promising new chapter for the electric vehicle manufacturer.

The JV has an expanded deal size of up to $5.8 billion and aims to leverage Rivian (NASDAQ:RIVN)'s advanced electrical architecture and software technologies to propel both companies’ electric vehicle ambitions.

Wedbush analysts describe this development as “a large step in the right direction” and a key move for Rivian moving forward.

Leadership and Development Focus

The joint venture will combine talent from both Rivian and Volkswagen, led by Wassym Bensaid from Rivian and Carsten Helbing from Volkswagen. The team aims to develop a shared platform for future electric vehicle models, launching Rivian’s R2 model in 2026 and Volkswagen’s EVs by 2027.

Financial Backing

Wedbush notes this move provides “a breath of fresh air” for Rivian, offering an opportunity for vertical integration of its software and architecture, which may lead to cost savings and improved production capabilities.

Volkswagen has already invested $1 billion through a convertible note, planning to contribute up to $5.8 billion by 2027 in various forms, including equity, debt, and additional convertible notes linked to performance milestones.

This financial support will focus on Rivian’s mid-size R2 and R3 platforms and the expansion of its Georgia plant, crucial for the company’s growth.

Analyst Ratings

Wedbush maintains an Outperform rating with a $20 price target for Rivian. They acknowledge that, while the JV is a significant milestone, investor attention will remain on Rivian’s R1 production and path towards profitability, particularly as the partnership arrives amid current supply chain challenges.