Rivian (RIVN) and Volkswagen received the green light from German authorities to form a new joint venture. With “no series competition problems” to worry about, the German Federal Cartel Office approved the Rivian/VW partnership on Monday.
Rivian and Volkswagen gain German approval
It’s been over a month since Rivian and VW announced the landmark alliance. The new partnership will use Rivian’s software expertise to develop an architecture for next-gen EVs.
Volkswagen will invest up to $5 billion, $3 billion of which will go to Rivian and $2 billion in the joint venture. However, these investments are based on meeting “certain milestones.”
The partnership took a big step forward on Monday after gaining approval from German competition authorities.
The Bundeskartellamt announced it has “cleared under merger control the formation of a joint venture between Volkswagen and US electric car manufacturer Rivian.” The office also approved VW’s investment in Rivian.
Andreas Mundt, president of the Bundeskartellamt, explained that the Rivian and Volkswagen JV is “not expected to significantly impede effective competition.”
In a statement released Monday, the agency added, “There will continue to be a sufficient range of services available to car manufacturers to build E/E architectures.”
Electrek’s Take
The new Rivian and Volkswagen JV is expected to be finalized by the end of the year. Gaining approval from the German antitrust authority suggests the partnership is still progressing.
The news comes as Rivian looks to scale output after a planned shutdown at its Normal, Il plant caused deliveries to remain flat (13,790) in the second quarter. Rivian expects output to ramp up 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 struggles have delayed key EVs, like the Porsche Macan. New reports suggest VW is delaying more EVs, including the ID.4 successor, due to ongoing software hurdles.
VW’s next-gen SSP platform, which is expected to use software from the Rivian tie-up, is not expected until 2029. That’s another 15 months from the initial plans.
Rivian’s CEO, RJ Scaringe, said the VW JV is different from its other partnerships with Ford and Mercedes because it’s focused “precisely on the thing that has always been the challenge.”
Volkswagen hopes Rivian can help fix its software woes. What do you think? Will the Rivian tie-up help VW clear its software hurdles? Let us know your thoughts below.
Author: Peter Johnson
Source: Electrek
