\n
![](\"https:\/\/fortune.com\/img-assets\/wp-content\/uploads\/2024\/06\/GettyImages-2059234077-e1719352254412.jpg?w=2048\")
<\/p>\n [ad_1]
\n<\/p>\n
Volkswagen<\/a> AG will invest $5 billion to form a joint venture with electric vehicle maker Rivian Automotive Inc., throwing a lifeline to the struggling startup and giving the German automaker access to the American EV company\u2019s technology.<\/p>\n VW said in a release that it will invest $1 billion immediately in Rivian and an additional $4 billion over time. The companies said the new venture will be \u201cequally controlled and owned.\u201d The companies said they will develop \u201cnext generation\u201d battery-powered vehicles with leading edge software.<\/p>\n Rivian\u2019s shares jumped in aftermarket trading, gaining as much as 37%. Through Tuesday\u2019s close, Rivian\u2019s stock had fallen 49% on the year.<\/p>\n \u201cThrough our cooperation, we will bring the best solutions to our vehicles faster and at lower cost,\u201d Oliver Blume, VW\u2019s CEO, said in a statement. \u201cWe are strengthening our technology profile and our competitiveness.\u201d<\/p>\n The pact provides Rivian with a much-needed source of fresh capital after the company struggled to ramp up production and deliveries of its electric pickup and SUV models.\u00a0<\/p>\n For VW, the German automotive giant gets access to the EV startup\u2019s software and EV architecture after years struggling to roll out plug-in vehicles with efficiency and functionality on par with those from Tesla<\/a> Inc.\u00a0<\/p>\n Both companies plan to introduce vehicles featuring technology created by the joint venture in the second half of this decade, according to the companies\u2019 joint statement.<\/p>\n<\/div>\n\nSubscribe to the Fortune Next to Lead newsletter to get weekly strategies on how to make it to the corner office. Sign up for free<\/a>.<\/div>\n<\/div>\n