Rivian share price jumps 50% on Volkswagen’s $5 billion investment

Rivian share price jumped 50% in extended trading on Tuesday after German automaker Volkswagen announced an investment of $5 billion in the electric vehicle (EV) startup as part of a new, equally controlled joint venture aimed to share EV architecture and software.

Rivian shares surged 8.6% on Tuesday and 49.9% to $17.93 in after-hours trading, lifting the company’s market value by nearly $6 billion. The stock is still down over 43% year-to-date (YTD).

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Rivian will license its existing intellectual property to the JV, and the R2 will be the first vehicle using software from the JV. Volkswagen vehicles, including its Audi, Porsche, Lamborghini and Bentley brands, will follow.

Volkswagen will immediately invest $1 billion in Rivian through a note that will convert to stock on December 1, subject to regulatory approvals. The German auto major will also make a $1 billion payment at the inception of the JV, Reuters reported.

Volkswagen will also invest $2 billion in Rivian stock - $1 billion each in 2025 and 2026 - subject to the startup hitting certain milestones, and provide a $1 billion loan in 2026.

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In a post on social media platform X, Rivian CEO RJ Scaringe said, “the partnership brings Rivian’s software and zonal electronics platform to a broader market through Volkswagen Group’s global reach and scale, while providing an expected $5B of capital to Rivian as we bring R2 and our next generation of vehicles to market!”

The investment will provide Rivian the funding necessary to develop its less expensive and smaller R2 SUVs that are set to roll out in early 2026 and its planned R3 crossovers, Scaringe told Reuters.

Rivian reported a loss of $1.45 billion in its latest quarter and the joint venture would help the EV maker to become cash-flow positive.

(With inputs from Reuters)