Rivian (RIVN) and Volkswagen got the green light from the German government to form a new joint venture. No longer having to fear “serial festival problems,” Germany’s Federal Cartel Office approved the Rivian/VW partnership on Monday.
It’s been more than a month since Rivian and VW announced their historic partnership. The new partnership will use Rivian’s software to extend the architecture of next-generation electric vehicles.
Volkswagen will invest up to $5 billion, adding $3 billion in Rivian and $2 billion in the joint venture. However, those investments are in the process of reaching “certain milestones. “
The association stepped forward on Monday after gaining approval from German festival authorities.
The Bundeskartellamt announced that it had “authorized, under merger control, the creation of a joint venture between Volkswagen and the American electric car manufacturer Rivian. “It also approved VW’s investment in Rivian.
Andreas Mundt, president of the Bundeskartellamt, explained that the joint venture Rivian and Volkswagen “should especially prevent effective competition. “
In a statement on Monday, the company added: “There will always be enough diversity of facilities for automakers to build E/E architectures. “
The new Rivian and Volkswagen joint venture is expected to be completed by the end of the year. Winning approval from the German antitrust authority suggests that the partnership continues to move forward.
The news comes as Rivian looks to increase production after a planned shutdown at its Normal, Il. , plant caused shipments to remain flat (13,790) in the second quarter. Rivian expects production to increase in the second half of 2024.
Sales of Volkswagen’s sole EV in the US, on the other hand, the ID.4, fell 15%. VW has struggled to gain traction as the market shifts to EVs as software issues have derailed progress.
Software difficulties have delayed key electric vehicles, such as the Porsche Macan. New reports indicate that VW is delaying the arrival of more electric vehicles, adding the successor to the ID. 4, due to persistent software obstacles.
VW’s next-generation SSP platform, which is expected to use software from the Rivian alliance, is expected to arrive through 2029, 15 months more than initial plans.
Rivian CEO RJ Scaringe said VW JV differs from its other partnerships with Ford and Mercedes because it focuses “precisely on what has been a challenge. “
Volkswagen hopes Rivian can handle its software problems. What do you think? Will the alliance with Rivian VW overcome its software hurdles?Share your thoughts below.
Peter Johnson covers the automotive industry’s step-by-step transformation to electric vehicles. He is an experienced investor, an enthusiast of money and electric vehicles. His enthusiasm for electric vehicles, mainly Tesla, is one of the main reasons why he pursued a career in the investment space. If he doesn’t tell you about his latest discoveries in the 10K, you can find him enjoying the outdoors or running.