Thursday, February 6, 2025

Paid 42 billion – VW wants to own more of the car brand

Volkswagen has already paid the equivalent of 42 billion kroner for parts of the American car brand Rivian. Now the Germans want more.

Volkswagen has already invested 42 billion kroner in the American electric car manufacturer Rivian, and now the German car giant wants to increase its ownership stake.

Volkswagen sees itself as a mentor to Rivian and believes that the money from Wolfsburg can give the young car brand an advantage in a highly competitive industry.

Volkswagen CEO Oliver Blume told German magazine Spiegel that a company of Volkswagen's size has unique advantages.

"For example, we are considering sharing modules and pooling purchasing volumes," he says, emphasizing that "the Volkswagen Group offers great opportunities for a small brand like Rivian."

In other words, Volkswagen's financial strength and large purchasing volume can help streamline production costs and supply chain challenges for Rivian, while both brands benefit from sharing technology.

Rivian plays a central role in the development of the next-generation electronics architecture that Volkswagen plans to implement in its future model program.

Rivian's developers and engineers are leading the work to develop a streamlined system that, according to Volkswagen, will revolutionize the electric car.

The new platform will reduce the complexity of current systems. Where today's Volkswagen cars use up to 100 control units, the new setup will use only seven compact control units to control critical systems.

These devices will integrate the microchips that the automotive industry was screaming for just a few years ago, sensors and cables to handle everything from infotainment to advanced driver assistance systems.

Among the first VW Group cars to be built on the new architecture are Porsche's upcoming seven-seat K1 SUV and the next-generation VW Golf.

Volkswagen's revived Scout brand will also benefit from the partnership, as its Terra and Traveler models will incorporate Rivian's advanced technology.

Volkswagen appears to be following Rivian's launch of the R1T and R1S models with the new Scout family. Like the Rivian models, the Terra and Traveler are a pickup truck and an SUV that share many components.

Blume emphasizes, however, that Scout is not aiming to compete directly with Rivian.

– The coach cars are positioned completely differently in the market, he believes.

READ ALSO: 7 out of 10 drivers admit to having the same problem in traffic

The Scout models start at around $45,000, while Rivian's R1 models start at around $70,000.

Rivian also plans to launch smaller, cheaper R2 and R3 models in the coming years, with starting prices of around $45,000 and $37,000, respectively. However, production is not expected to start until late 2026 at the earliest.

The first Volkswagen model with Rivian's electronics architecture is expected to hit the roads the following year. It will probably be the next Golf in the series, as it has already been confirmed that Rivian will develop large parts of the car.

Volkswagen is not saying where the money for a further acquisition of Rivian will come from, however. On the other hand, it was not many months ago that the brand's finance director announced that the Germans would run out of money within 2 to 3 years if the trend is not reversed.

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