VW’s software partnership with Rivian clears investment hurdle

The logos of Volkswagen cars are pictured in Frankfurt, Germany. (AP Photo/Michael Probst, File)

Volkswagen’s software partnership with Rivian, a cornerstone of CEO Oliver ‌Blume’s turnaround strategy for the German ‌auto group, has passed a key milestone, bringing the U.S. ​partner closer to its next tranche of funding.

Winter tests of the first vehicles using the software have been successfully completed, Volkswagen said on ‌Friday.

“We’re accelerating towards ⁠the future,” Blume said.

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The joint venture aims to develop a software platform ⁠to underpin a model revamp across Volkswagen’s core brand as well as its U.S. pickup truck ​business Scout ​and premium subsidiary ​Audi.

By joining forces with ‌Rivian, a California-based maker of electric vehicles, Blume sought outside help following years of problems at Volkswagen’s own software arm Cariad.

The German carmaker is under pressure to catch up in a ‌race with data and ​software-savvy players like Tesla and ​China’s BYD.

In ​November 2024, Volkswagen agreed to pay US$5.8 ‌billion under the collaboration by ​2027.

This included ​a $1-billion tranche expected this year upon completion of “technological milestones”.

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A spokesperson said at this time ​the company ‌would not comment on the details of ​the transaction.

(Reporting by Rachel More and Christina ​AmannEditing by Ludwig Burger)