- Rivian and Volkswagen Group intend to enter a joint venture to
create next generation software-defined vehicle (SDV) platforms to
be used in both companies’ future electric vehicles
- Volkswagen Group to invest an initial $1 billion in Rivian,
with up to $4 billion in planned additional investment for a total
expected deal size of $5 billion
- Joint venture is expected to build on Rivian’s industry-leading
software and electrical architecture to create best-in-class
software-defined vehicle technology platform
Rivian Automotive (NASDAQ: RIVN) and Volkswagen Group (XETRA:
VOW / VOW3) have today announced their intention to form an equally
controlled and owned joint venture (JV) to create next-generation
electrical architecture and best-in-class software technology.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20240625966539/en/
Oliver Blume, CEO of Volkswagen Group and
RJ Scaringe, Founder and CEO of Rivian announce joint venture
plans. (Photo: Business Wire)
The partnership is anticipated to accelerate the development of
software for Rivian and Volkswagen Group. It is expected to allow
both companies to combine their complementary strengths and lower
cost per vehicle by increasing scale and speeding up innovation
globally. Rivian’s proven in-market zonal hardware design and
integrated technology platform are expected to serve as the
foundation for future SDV development in the JV that will be
applied to both companies’ vehicles. Rivian plans to contribute its
electrical architecture expertise and is expected to license
existing intellectual property rights to the joint venture.
Both companies aim to launch vehicles benefiting from the
technology created within the joint venture in the second half of
the decade. In the short term, the joint venture is expected to
enable Volkswagen Group to utilize Rivian’s existing electrical
architecture and software platform. The partnership’s ambition is
to accelerate Volkswagen Group’s SDV plans and transition to a pure
zonal architecture. Each company will continue to separately
operate their respective vehicle businesses.
Oliver Blume, CEO of Volkswagen Group said:
“Our customers benefit from the targeted partnership with Rivian
to create a leading technology architecture. Through our
cooperation, we will bring the best solutions to our vehicles
faster and at lower cost. We are also acting in the best interest
of our strong brands, which will inspire with their iconic
products. The partnership fits seamlessly with our existing
software strategy, our products, and partnerships. We are
strengthening our technology profile and our competitiveness.”
RJ Scaringe, Founder and CEO of Rivian said:
“We’re very excited to be partnering with Volkswagen Group.
Since the earliest days of Rivian, we have been focused on
developing highly differentiated technology, and it’s exciting that
one of the world’s largest and most respected automotive companies
has recognized this. Not only is this partnership expected to bring
our software and associated zonal architecture to an even broader
market through Volkswagen Group’s global reach, but this
partnership also is expected to help secure our capital needs for
substantial growth. Rivian was created to help the world to
transition away from fossil fuels through compelling products and
services, and this partnership is beautifully aligned with that
mission.”
Underpinned by the vision of the strategic partnership,
Volkswagen Group plans to make a $5 billion investment into Rivian.
Initially Volkswagen Group will invest $1 billion in Rivian through
an unsecured convertible note that will convert into Rivian’s
common stock subject to certain conditions upon the later of
receipt of regulatory approvals and December 1, 20241. Volkswagen
Group is expected to invest a further $4B as part of the
transaction2.
There has been significant work done over the past months to
validate that Rivian’s electrical architecture and software are
compatible with Volkswagen Group’s vehicles. The parties currently
expect the completion of the JV formation in the fourth quarter of
2024. All transactions described in this release are subject to the
completion of definitive agreements, the conditions included in
those agreements and the receipt of required regulatory approvals.
Lazard is serving as lead financial advisor and BDT & MSD
Partners is serving as financial advisor to Rivian.
Notes to editors:
1 The conversion price of half of the outstanding amount under
the note will be calculated based on a certain daily
volume-weighted average price (VWAP) prior to this announcement and
the conversion price for the remaining half will be calculated
based on a certain daily VWAP prior to the conversion date.
2 The additional investment of up to $2B in Rivian’s common
stock is expected to take place through two tranches of $1B each in
2025 and 2026, with pricing based on a certain daily VWAP of
Rivian’s common stock prior to each respective purchase. The
investment of $2B related to the JV is expected to be split between
a payment at the inception of the JV and a loan available in
2026.
At 6pm ET today, Rivian will host an open investor call. The
link to the call can be found (here). A recording of
the call will be available on the same link for 12 months.
Rivian (NASDAQ: RIVN) is an American automotive
manufacturer that develops and builds category-defining electric
vehicles and accessories. The company creates innovative and
technologically advanced products that are designed to excel at
work and play with the goal of accelerating the global transition
to zero-emission transportation and energy. Rivian vehicles are
built in the United States and are sold directly to consumer and
commercial customers. The company provides a full suite of services
that address the entire lifecycle of the vehicle and stay true to
its mission to keep the world adventurous forever. Whether taking
families on new adventures or electrifying fleets at scale, Rivian
vehicles all share a common goal — preserving the natural world for
generations to come.
Learn more about the company, products and careers at
www.rivian.com.
About Volkswagen Group
The Volkswagen Group is one of the world's leading car makers,
headquartered in Wolfsburg, Germany. It operates globally, with 114
production facilities in 19 European countries and 10 countries in
the Americas, Asia and Africa. With around 684,000 employees
worldwide. The Group’s vehicles are sold in over 150 countries.
With an unrivalled portfolio of strong global brands, leading
technologies at scale, innovative ideas to tap into future profit
pools and an entrepreneurial leadership team, the Volkswagen Group
is committed to shaping the future of mobility through investments
in electric and autonomous driving vehicles, digitalization and
sustainability. In 2023, the total number of vehicles delivered to
customers by the Group globally was 9.2 million (2022: 8.3
million). Group sales revenue in 2023 totaled EUR 322.3 billion
(2022: EUR 279.1 billion). The operating result before special
items in 2023 amounted to EUR 22.6 billion (2022: EUR 22.5
billion)
Forward looking statements:
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. We intend such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained
in Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements contained in this press release that do not relate to
matters of historical fact should be considered forward-looking
statements, including without limitation statements regarding
receipt of regulatory approvals, the parties entering into
definitive agreements, the formation of the JV, the expected
benefits from the partnership, the future investments in Rivian
shares and the investments related to the JV, you can identify
forward-looking statements by terms such as “may,” “will,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“targets,” “projects,” “contemplates,” “believes,” “estimates,”
“forecasts,” “predicts,” “potential” or “continue” or the negative
of these terms or other similar expressions, although not all
forward-looking statements use these words or expressions.
We have based these forward-looking statements largely on our
current expectations and projections about future events and
financial trends that we believe may affect our business, financial
condition, and results of operations. Forward-looking statements
involve known and unknown risks, uncertainties and other important
factors that may cause our actual results, performance, or
achievements to be materially different from any future results,
performance, or achievements expressed or implied by the
forward-looking statements, including, but not limited to, the
important factors discussed in Part I, Item 1A, “Risk Factors” in
our Quarterly Report on Form 10-Q for the quarter ended March 30,
2024, and our other filings with the Securities and Exchange
Commission. The forward-looking statements in this press release
are based upon information available to us as of the date of this
press release, and while we believe such information forms a
reasonable basis for such statements, such information may be
limited or incomplete, and our statements should not be read to
indicate that we have conducted an exhaustive inquiry into, or
review of, all potentially available relevant information. These
statements are inherently uncertain, and investors are cautioned
not to unduly rely upon these statements. While we may elect to
update such forward-looking statements at some point in the future,
we disclaim any obligation to do so, even if subsequent events
cause our views to change.
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version on businesswire.com: https://www.businesswire.com/news/home/20240625966539/en/
Rivian Investors: ir@rivian.com Media:
Marina Hoffmann, +1.914.391.7395 – media@rivian.com
Volkswagen Group Pietro Zollino Deputy Head of
Group Communications & Head of Corporate Communications +49 (0)
172 8371431 pietro.zollino@volkswagen.de
Christopher Hauss Corporate Communications Head of
Strategy & Finance Communications +49 (0) 171 8769 225
christopher.hauss@volkswagen.de
Jonas Kulawik Corporate Communications Spokesperson
Product & Technology, Digitalization +49 (0) 152 2945 2616
jonas.alexander.kulawik@volkswagen.de
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