Rivian Automotive (RIVN) Investor Update summary

Joint venture formation and strategic rationale

• Announced the closing of a landmark joint venture with Volkswagen Group, valued up to $5.8 billion, validating years of technology development and vertical integration.

• The partnership aims to accelerate electrification, support the capital roadmap, and enable positive free cash flow.

• The joint venture will focus on developing industry-leading, scalable software and hardware platforms for a wide range of vehicles and markets.

• The partnership leverages Rivian's software and hardware technology with Volkswagen's global scale and vehicle platform expertise, aiming to create scalable, cost-effective solutions across multiple brands and markets.

• Leadership includes a co-CEO/CTO from Rivian, who will also remain Chief Software Officer, and a co-CEO from Volkswagen overseeing operations.

Technology and product scope

• The JV combines Rivian’s modular, flexible software stack and zonal architecture with Volkswagen’s global reach.

• Focus is on software-defined vehicle systems, excluding autonomy and propulsion, with each brand retaining its unique user interface.

• The platform will initially support premium VW brands (Porsche, Audi), then expand to broader segments and price points, including mass market and luxury.

• Rivian's vertically integrated electronics and software platform will serve as the foundation for the joint venture's technology development.

• Potential exists for applications beyond Rivian and Volkswagen products, with future opportunities anticipated.

Financial structure and milestones

• Initial $1 billion received in June as a convertible note, with $1.3 billion in cash at JV closing for IP license and equity stake.

• Additional $1 billion equity in 2025 at a 33% premium, contingent on gross profit milestones, and $1 billion in 2026 after successful winter testing.

• Option for a $1 billion non-recourse loan in 2026, and $460 million equity at the earlier of January 2028 or first production milestone, at an 84% premium.

• Volkswagen Group will fund 75% of shared platform costs through 2028, with Rivian funding 25%; from 2029, costs will be split equally, but Volkswagen will contribute an extra $100 million annually.

• The capital infusion is expected to fund Rivian's operations through the ramp-up of R2 and midsize platforms, supporting growth and a path to positive free cash flow.