Rivian and VW team up to take on the electric future
Rivian brings innovation, VW adds scale — together they’re taking on the EV industry’s biggest hurdles.
Rivian and Volkswagen unveiled a joint venture last week, named Rivian and VW Group Technology, LLC, which officially launched on Wednesday. Volkswagen is investing $5.8 billion in Rivian to leverage the startup's expertise in vehicle software and electrical architecture technologies. Adobe Stock
VW blindsided their in-house software company with this deal
The partnership was announced back in June although no specific unveiling date had been announced at the time. VW had been having major issues with Cariad, their in-house software division who were reportedly not made aware of the deal by VW's top brass. The company instead learned of it through the news, causing dismay for everyone at Cariad with many wondering whether they were all facing imminent layoffs.
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Both companies have been facing vastly different challenges
VW has been having a hard time transitioning to EVs regardless of their issues with Cariad, especially in China where competing with domestic companies is an uphill battle. Things got so bad that VW is even considering closing some of their German factories and recently scrapped their decades-old job guarantees to save money.
Rivian, on the other hand, will get a much-needed financial boost to assure its longevity and keep it away from the fate of other EV startups like Fisker or Lordstown Motors. They will probably also have access to VW's massive parts bin.
Rivian plays a major role in EV simplification
The partnership will be run by Rivian's Chief Software Officer, Wassym Bensaid, and Carsten Helbing, Volkswagen Group's CTO. Everything will initially be based in Palo Alto, California, although the group is planning to open three more sites in North America and Europe.
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Rivian has been doing a pretty good job at simplifying the complicated architecture of automotive electronics. Their second generation Rivian R1 dropped the number of ECUs from 17 to a mere seven, reducing the miles of wires and making potential repairs much easier.
The partnership's new architecture will trickle down to other brands and models
By combining VW's decades of knowledge with Rivian's newest EV breakthroughs, the two companies will reportedly develop "next-generation electrical architecture and best-in-class software technology for both companies’ future electric vehicles, covering all relevant vehicle segments, including subcompact cars."
VW eventually intends to bring this new architecture to the other brands in their portfolio with Audi, Scout, and Porsche benefiting first. They also mentioned that Cariad will still play a role in their software strategy.
Final thoughts
Hopefully Rivian is the knight in shining armor that VW has been searching for. It would be a shame to see such a storied player in the automotive world falter due to the encroaching switch to EVs.
As for Rivian, their SUV and pickup truck have been unique additions to the market since the beginning. Getting so much capital and exposure from a big-name brand like VW will undoubtedly do wonders for the company and we're looking forward to see their future innovations, regardless of powertrain.
