German auto giant Volkswagen plans to invest up to $5 billion in the US electric car manufacturer Rivian in the coming years, both companies announced.
The partnership is expected to accelerate software development, Volkswagen announced in a statement after the US stock market closed on Tuesday.
Following the establishment of the joint venture, Volkswagen will have direct access to Rivian's electric car technology for implementation in its electric vehicles.
"Through our cooperation, we will bring the best solutions to our vehicles faster and at lower cost," Volkswagen Group chief executive Oliver Blume said.
The Volkswagen Group will invest an initial $1 billion in Rivian, with a planned additional investment of up to $4 billion, bringing the total expected deal size to $5 billion.