Rivian R2

vw-puts-$5b-into-cash-hungry-rivian,-and-rivian-will-help-fix-up-vw’s-software

VW puts $5B into cash-hungry Rivian, and Rivian will help fix up VW’s software

RivianWagen. VolksVian? —

Rivian gets a third major partner, and new cars arrive later this decade.

Up-close image of Rivian's dash screen, showing on-road/off-road settings

Rivian

Volkswagen is committing $5 billion to upstart EV company Rivian, with $1 billion in cash upfront and $4 billion over time. The companies aim to use this joint venture to deliver new vehicles “in the second half of the decade,” according to the announcement, and the cash will likely help push along Rivian’s next generation of vehicles, including more affordable models.

Oliver Blume, left, CEO of Volkswagen Group, and RJ Scaringe, founder and CEO of Rivian.

Enlarge / Oliver Blume, left, CEO of Volkswagen Group, and RJ Scaringe, founder and CEO of Rivian.

Rivian

Rivian founder and CEO RJ Scaringe wrote on X (formerly Twitter) that the partnership “brings Rivian’s software and zonal electronics platform to a broader market through Volkswagen Group’s global reach and scale.” VW Group, which also controls Porsche, Lamborghini, Audi, and Ducati, among others, has a lot to gain from working with Rivian, particularly when it comes to software and ride control. Ars and most other reviewers have been impressed by Rivian’s drive engineering and display software on the R1T truck, R1S SUV, and the second generations of them both, which majorly reworked the underpinnings and offerings, largely through design and software choices.

Volkswagen’s recent software moves have been on an opposing trajectory. The Group’s 2019 moves to align all its brands’ software under one division, Cariad, with three platforms developed at once, has led to massive leadership shake-ups and restarts. We were not impressed with the ID.4’s infotainment system in 2021, and further bugs in both system and screen software plagued the car, undermining what was otherwise regarded as a good wheels-on-road experience.

Other car and tech companies previously invested in Rivian on its long, expensive path to EV production. Rivian took $500 million from Ford in 2019 after already picking up $700 million from Amazon that year. Part of Ford’s investment centered on a Lincoln SUV developed using Rivian’s battery and motor tech—or “skateboard” platform—but that project was canceled early in the pandemic.

Rivian, which was valued at nearly $86 billion during its public stock debut, has burned through a lot of cash, making well-liked cars that cost a lot to build. In the first quarter of 2024, it sold its cars for an average of $38,784 less than it cost to make them before expenses like research, development, sales, or marketing. Having paused production on a $5 billion truck plant and gone through rounds of recent layoffs, the firm lost $1.51 billion last quarter. Rivian reported $7.86 billion in cash on hand and $4.43 billion in debt.

Hence the likely very useful first $1 billion from VW to Rivian, a convertible note that becomes Rivian common stock after regulatory approval. Two more $1 billion payments should arrive in 2025 and 2026, with a $2 billion loan tied to the joint venture available in 2026.

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Rivian reveals three new, smaller electric SUVs: The R2, R3, and R3X

no astromech droids were hurt in the making of this post —

The new EVs use Rivian’s new midsize platform, and R2 deliveries begin in 2026.

Rivian R2, R3, and R3X SUVs parked together

Enlarge / From left to right, the Rivian R2, Rivian R3, and Rivian R3X.

Rivian

Today in California, Rivian CEO and founder RJ Scaringe unveiled new additions to the electric vehicle startup’s model lineup. Details of the new R2 had leaked earlier this week, although not entirely accurately—the new smaller EV will start at $45,000 (not $47,000) when it goes on sale in 2026.

At first glance of the R2, you might be excused for thinking you’re looking at a Rivian R1S, for both SUVs share a lot of styling details—not just Rivian’s distinctive daylight running lights but also the overall shape of the vehicle. But the new car is shorter in both length (by 15.7 inches/400 mm) and height, and only offers two rows of seating, not three.

Convenience improvements include a pair of gloveboxes under the dashboard and a flashlight that’s stored in the door. At the back, the glass rear window can drop down to allow access to the cargo area. Both rows of seats fold flat, in case you want to camp in your car.

Rivian will build three different powertrain configurations of the R2: a single-motor, rear-wheel drive version, a twin-motor, all-wheel drive model, and a tri-motor option. Scaringe said that all three will have at least 300 miles (482 km) of range. The tri-motor R2 can accelerate from 0–60 mph in under three seconds.

The battery pack uses larger-format 4695 cylindrical cells, and Scaringe says that the R2 will go into production at the company’s first factory in Normal, Illinois. Reservations for the R2 opened today with a $100 deposit. Deliveries are scheduled for the first half of 2026.

  • The Rivian R2 looks a lot like the larger R1S.

    Rivian

  • Rivian says it will save $2.5 billion by starting R2 production in Illinois instead of waiting for the plant in Georgia.

    Rivian

  • A size comparison with the R1S.

    Rivian

  • Here’s the R2 interior

    Rivian

  • The addition of gloveboxes is a welcome touch.

    Rivian

  • The R2’s seats all fold flat.

    Rivian

  • A look at the R2 door cards.

    Rivian

  • The center console has plenty of cubbies.

    Rivian

  • Rivian plans a range of R2 accessories, including a camp kitchen and a tent.

    Rivian

Although details on the R2 had already leaked, the company prevented that from happening for another new model, introduced by Scaringe with a Steve Jobs-like “one more thing…” toward the end of the presentation. In fact, it was two new things: a pair of even smaller electric crossovers called the R3 and R3X.

Like the R2, these two new models use the same new midsize platform (as opposed to the larger platform that underpins the R1S, R1T, and the Rivian Delivery Van). The R3 and R3X keep Rivian’s distinctive light signature but eschew copying the larger SUV’s silhouette for a shape that looks more like a Fiat Panda or Lada Niva, at least to this observer.

The R3 has a wheelbase that is 5 inches (125 mm) shorter than the R2 but will also be offered with the same three choices of powertrains and have more than 300 miles of range. The R3X is much like the R3 but with wheel arch extensions and a rear spoiler.

Like the bigger R1 and R2, the R3 and R3X have a cargo frunk up front. Similar to the R2, the front and rear seats fold flat. The rear hatch glass opens independently of the hatch, which allows you to carry larger payloads.

The R3 and R3X will be built at Rivian’s new factory in Georgia, but for now, we can’t tell you when deliveries will start or how much you’ll have to pay to have one in your driveway or garage.

  • The same adorable face but in a small new package—the Rivian R3.

    Rivian

  • The glass in the hatch opens independently for large loads like a surfboard.

    Rivian

  • I’ll be honest, if Rivian was taking R3 deposits today I’d have sent in my $100.

    Rivian

  • The Rivian R3X is off-road coded.

    Rivian

  • Rivian

  • A look at the Rivian R3 interior.

    Rivian

  • The R3’s back seat will be a bit more cramped than the R2.

    Rivian

  • The R3’s door card, which also has a flashlight stored in it.

    Rivian

  • The R3X interior has the same layout as the R3 but with different materials.

    Rivian

  • The rear seats in the R3 and R3X are split 40: 20: 40.

    Rivian

DC fast-charging for all three models should take under 30 minutes to charge from 10–80 percent, Rivian tells us, and the cars will feature native J3400 charging ports. We also learned that later this month, existing Rivian owners will gain access to the Tesla Supercharger network, although these EVs will need to use a CCS1-J3400 adapter.

“I have never been more excited to launch new products—R2 and R3 are distinctly Rivian in terms of performance, capability and usability yet with pricing that makes them accessible to a lot of people. Our design and engineering teams are extremely focused on driving innovation into not only the product features but also our approach to manufacturing to achieve dramatically lower costs,” said Scaringe. “R2 provides buyers starting in the $45,000 price range with a much-needed choice with a thoroughly developed technology platform that is bursting with personality. I can’t wait to get these to customers.”

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