A big bang in the car industry: Volkswagen is joining forces with US electric vehicle manufacturer Rivian to develop car software and plans to invest up to five billion dollars in the project. The Wolfsburg-based car manufacturer and Rivian intend to set up a joint venture for this purpose, which will be owned equally by both companies.

The purpose of this JV is to speed up the software development processes - especially for VW. The firm had concentrated its software activities in a subsidiary called Cariad; however, the venture has been troubled with management and efficiency issues for a long time. 

From our point of view, this move is interesting as it marks the first big (multi billion dollar)  investment of a German OEM into a US automotive Start Up solely for the purpose of software development. This makes sense insofar as the Chinese competitors ( as well as Tesla) have had a clear advantage in this field for a long time. 

Time will tell if the cooperation helps VW become more competitive and better with their software - but in any case, the investment is a clear statement by the VW CEO that he isn`t willing to let the problem drag on for much longer.