Volkswagen plans to invest billions in an electric car company

Traditional the German car manufacturer Volkswagen and the American electric car manufacturer Rivian plan to join forces in the field of software-based electric cars.

Volkswagen is about to invest a total of five billion dollars over the course of a couple of years. First to one billion Rivian and in the next couple of years two billion dollars more. Volkswagen plans to invest two billion dollars in a joint venture developing technology.

The products of the established joint venture could be used in the car models of both companies already at the end of this decade. Rivian’s technology is expected to be the basis for development, according to the information published on Tuesday from the bulletin. Among other things, the figure aims for lower costs per car.

Volkswagen gets access to Rivian’s software technology, with which the company aims to speed up the development of software-based cars.

According to financial media, Volkswagen’s own Cariad unit, which develops software, has had difficulties, such as delays in launching new products. They tell about these, for example Financial Times, Reuters and Wall Street Journal.

The traditional Volkswagen wants to improve its position in the electric car competition with an investment.

In trouble for the tarpon For Rivian, the pattern brings much-needed confirmation to the financial situation.

The partnership helps secure capital needs for “tangible” growth and brings the company’s software to a wider market, says the company’s CEO RJ Scaringe in the bulletin.

Rivian’s share jumped more than 30 percent on the aftermarket when the information became public.