Rivian and Volkswagen Group are reportedly facing setbacks in their joint venture, as difficulties in adapting the EV maker’s software to VW models have been delaying the progress on upcoming electric vehicles
Citing sources close to the legacy automaker, the local outlet Manager Magazin reported that both companies held a critical meeting last week in Germany amid the Munich Auto Show.
Volkswagen has invested about €12 billion in its subsidiary Cariad to develop automotive software.
However, after internal bureaucratic struggles, the company has shifted from full in-house software development to partnerships with software-focused brands.
This change came under Volkswagen Group’s direction of Oliver Blume, who succeeded Herbert Diess in 2022.
Rivian and Volkswagen entered a partnership late last year, according to which the German automaker agreed to invest $5.8 billion in the EV maker as it adopts Rivian‘s zonal architecture and software stack in its future electric vehicles.
A year before, Volkswagen partnered with Chinese EV maker XPeng, which started with the joint development of two mid-size fully electric models for the Chinese market.
Volkswagen invested about $700 million in a 4.99% stake in XPeng, a purchase that was completed by year end.
The two companies have since expanded their cooperation in China beyond electric vehicles to include hybrid and internal combustion engine (ICE) models.
However, Volkswagen is not finding the partnership with Rivian as smooth.
As the German automaker brings ICE vehicles back into its lineup, sources say the Irvine-based EV maker shows little interest in adapting its software for those models.
Manager Magazin also revealed that the two companies have met in Munich last week, in a “crisis meeting” to reorganize launch plans for upcoming EVs.
Both Rivian‘s CEO RJ Scaringe and Software Chief Wassym Bensaid were at the IAA Auto Show, despite Rivian not having publicly announced their presence.
Upon visiting Audi‘s booth, Bensaid posted on X two pictures of the ‘Concept C’, a fully electric two-seat sports vehicle debuted by the German brand at the auto show. He also visited Volkswagen Group‘s electric brand Scout Motors.
Rivian is not present in European markets yet — but intends to expand to the Old Continent in 2027, with its mid-size $45,000 SUV R2, expected to launch in the first half of next year.
According to Manager Magazin, Volkswagen employees assigned to the joint venture with Rivian have been largely sidelined in software development, as the EV maker prioritizes the launch of its R2 SUV.
The R2, which will debut Rivian‘s new zonal architecture, will be the first vehicle to test the system.
Proper testing for Volkswagen, Audi, and other Group brands will only begin afterward — such as their full access to the software.
When the code is made available, Volkswagen brands will be able to integrate and adapt it for their own models.
However, tensions are already emerging: Volkswagen’s brands want greater room for customization, while Rivian favors keeping the software simple and uniform.
According to the report, Audi’s upcoming refreshed A4 and Q8 SUVs were delayed from late 2025, early 2026 to the second half of 2028.
The German premium brand had announced earlier in September that it will launch its first vehicles equipped with Rivian-developed software in 2028.
The launch of Porsche’s K1 SUV, originally planned for 2027, has been put on hold indefinitely — as the automaker struggles to roll out electric vehicles and shifts focus back to internal combustion engine (ICE) models.
Late last month, Oliver Blume stepped down as Porsche’s chief executive to focus solely on leading Volkswagen, a move aimed at easing shareholder concerns.
Rivian‘s software will be integrated in Volkswagen‘s upcoming ID.1 model, an entry-level vehicle to its electric lineup and the first software-defined vehicle from the legacy automaker, according to the brand’s CEO Thomas Schäfer.
To Bensaid, VW’s hardware complexity — “different seats, different doors, different lights, different sensors, different cameras in the different vehicles” — can be mitigated “by moving it to software.”
Volkswagen announced earlier this year that the production version will be launched in 2027, having been anticipated from 2028.
However, the timeline is now in question.
Rivian secured a $1 billion equity investment from Volkswagen Group, following the achievement of a gross profit milestone in the first quarter of the year, which was a condition for the investment to follow through.
After the second quarter earnings results a month ago, Rivian‘s CFO Claire McDonough noted that its Software and Services segment reported “another strong quarter” with $376 million of revenue and $129 million of gross profit.
“About half of the revenue within Software and Services was a result of the Software and Electrical Hardware joint venture we created with Volkswagen Group,” the CFO added then.
