Volkswagen\u00a0plans to invest up to $5 billion in electric vehicle startup\u00a0Rivian, starting with an initial investment of $1 billion.<\/p>\n
The additional $4 billion is expected by 2026. It includes plans for $1 billion each in 2025 and 2026, followed by $2 billion in 2026 related to an expected joint venture to create electrical architecture and software technology, according to\u00a0a release by the automakers\u00a0Tuesday.<\/p>\n
Shares of Rivian soared roughly 40% during after-hours trading Tuesday, two days ahead of an investor event for Rivian, which has been under pressure from Wall Street due to its cash burn and significant losses. Rivian stock closed Tuesday at $11.96 a share, down roughly 49% in 2024.<\/p>\n
The initial $1 billion from Volkswagen will be in the form of a convertible note, which could be converted to Rivian shares on or after Dec. 1, the release said.<\/p>\n
Rivian will host an\u00a0investor call\u00a0to discuss the tie-up at 6 p.m. ET Tuesday.<\/p>\n
Volkswagen is now the second legacy automaker to take a stake in the California-based company.\u00a0Ford Motor\u00a0was among Rivian\u2019s largest stakeholders, at roughly 12%, alongside\u00a0Amazon\u00a0when Rivian went public in 2021. The Detroit automaker exited Rivian in 2023\u00a0after walking back a plan to codevelop EVs with the company.<\/p>\n
The Volkswagen-Rivian partnership comes as automakers shift strategies amid\u00a0slower-than-expected adoption\u00a0of EVs. It was not immediately clear what, if any, effect the deal will have on Volkswagen\u2019s plans to build a $2 billion EV plant for its new Scout Motors trucks and SUVs in South Carolina.<\/p>\n
Rivian has been on a cost-cutting mission for months. It has trimmed staff, retooled its Illinois plant to increase efficiencies and paused construction of a new multibillion-dollar factory in Georgia. That last measure is expected to save more than $2.25 billion in capital spending, including the impact of starting production of Rivian\u2019s next-generation R2 vehicle at its plant in Illinois.<\/p>\n
The EV maker reported a loss of $1.45 billion during the first quarter of this year, as it retooled its plant in Normal, Illinois, to launch updated versions of its\u00a0R1T pickup and R1S SUV EVs\u00a0ahead of its next-generation vehicles in 2026.<\/p>\n
Rivian reported\u00a0$7.86 billion in cash, cash equivalents and short-term investments to end March, with more than $9 billion in total liquidity.<\/p>\n<\/p>\n
Volkswagen\u00a0plans to invest up to $5 billion in electric vehicle startup\u00a0Rivian, starting with an initial investment of $1 billion. The additional $4 billion is expected by 2026. It includes plans for $1 billion each in 2025 and 2026, followed by $2 billion in 2026 related to an expected joint venture to create electrical architecture and […]<\/p>\n","protected":false},"author":0,"featured_media":5596,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-5595","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/5595","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=5595"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/5595\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/5596"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=5595"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=5595"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=5595"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}