Power shift: VW turns to Rivian for EV software

The rise of the software-defined vehicle (SDV) and electrification put computing power and electronics at the heart of automotive success. This is a dramatic shift for an industry traditionally based on sheet metal and engine power. Incumbents are scrambling to remain relevant in the rapidly evolving landscape, but building the necessary in-house expertise is proving challenging. That’s where partnerships come into play, particularly between long-established giants and small start-ups. The benefits could be significant for both parties, but it’s a strategy not without significant risk.

Volkswagen meets Rivian

Volkswagen Group offers an interesting case study of the OEM evolution underway. One of the largest and most diversified automotive manufacturers, it’s been investing heavily in electric vehicles (EVs) and in-house software. In 2020, VW established Cariad as a specialised software unit, but the division’s well-publicised struggles have resulted in several model launch delays and thousands of job cuts. In June 2024, the automaker announced a new partnership that will see it source software expertise from Californian EV start-up Rivian moving forward.