Volkswagen Invests Another Billion in Rivian, the Rising Star

Rivian has just secured an additional $1 billion as part of its partnership with Volkswagen Group, signed last year.

This agreement, representing a total funding of nearly $6 billion, provides Rivian with the necessary capital to launch its future mass-market models, the R2 and R3 crossovers.

Rivian has reached this milestone by recording a second consecutive positive quarter in Q1 2025. The company generated a gross profit of $206 million from vehicle sales, as well as services and software. These results meet a key condition of the deal with Volkswagen.

As part of this partnership, Volkswagen will utilize Rivian’s electric architecture and software for its electric vehicles, starting with an entry-level VW city car. The two companies have also created a joint venture based in Silicon Valley to develop core technologies jointly for their future models.

Rivian CEO R.J. Scaringe announced that the billion dollars should be paid by the end of June. There are still $3.5 billion to be unlocked through this agreement.

Beware of the Rivian Bubble Burst!

Despite these advances, Rivian is not yet globally profitable, posting a net loss of $541 million in the last quarter. While encouraging, the gross profit does not account for fixed costs such as research and development.

Volkswagen’s funding is crucial for Rivian’s survival and growth. The production of the R2 will begin in 2026 at the Normal plant in Illinois, while a second factory in Georgia will eventually manufacture the R2 and R3. These vehicles, more affordable than the current R1S, R1T, and the electric van that delights Amazon, are expected to significantly increase Rivian’s volumes and revenues.

In 2024, Rivian delivered 51,579 vehicles, a stable figure. However, the company predicts a decline in 2025, with estimated deliveries dropping between 40,000 and 46,000, mainly due to tariffs from dear Donald Trump.

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