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Volkswagen wants to work with Rivian on software development. Employees of VW’s own software subsidiary Cariad fear the worst.
Wolfsburg – Volkswagen announced at the end of June that it would develop its car software together with the US electric car manufacturer Rivian. Initially, one billion dollars will be invested in the establishment of a joint venture. By 2026, Volkswagen’s total investment in Rivian could rise to up to five billion dollars. The cooperation includes software, control units and network architecture.
Cariad employees fear the end: Head of the software division was not involved in talks with Rivian
Table of Contents
- 1 Cariad employees fear the end: Head of the software division was not involved in talks with Rivian
- 2 Cariad employees fear the end: There is currently a lot of chaos
- 3 Cariad employees fear the end: top management changed priorities several times
- 4 Top 10: The ten most popular car brands in Germany
- 5 How will Volkswagen’s $5 billion investment in Rivian impact the electric vehicle market?
VW has so far bundled software development in its subsidiary Cariad, which has, however, repeatedly been hit by problems. Because important software was not ready on time, the subsidiaries had to Audi and Porsche even postpone the introduction of new models. By working with Rivian, VW could solve these problems.
Volkswagen has bundled the software expertise of the Group brands in the Cariad division. © Timon Schneider/Imago
However, the cooperation seems to be causing great uncertainty among Cariad’s approximately 6,000 employees. Cariad boss Peter Bosch is said to have not been involved in the talks between VW and Rivian. This is reported by Financial Times“We all heard about Rivian from the news,” the business newspaper quoted a senior Cariad engineer as saying.
Cariad employees fear the end: There is currently a lot of chaos
The fears seem to be great. “There is so much chaos at the moment,” says another employee in the software unit. “But we know that it is more or less the end of Cariad.” There are also doubts as to whether VW’s new software strategy will work at all.
Stephen Reitman’s fears are similar. The new joint venture is “another nail in the coffin” for Cariad, the automotive analyst from Bernstein Research told Manager Magazine.
However, the Cariad employees have a powerful advocate in the form of VW works council chairwoman Daniela Cavallo. “Can we be sure that this is not the next billion-dollar grave?” she said, according to Financial TimesThey want to fix the errors in Cariad instead of outsourcing the development of critical software.
Cariad employees fear the end: top management changed priorities several times
Cariad employees, on the other hand, blame the bureaucratic structure and the changing priorities of VW’s top management for the problems of the software division. Former CEO Herbert Diess, under whose aegis the division was founded, gave priority to the development of the so-called Platform 2.0 for the vehicles.
Top 10: The ten most popular car brands in Germany
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When Diess’ successor Oliver Blume took over in 2022, development of the platform was halted. Engineers were instead told to focus on fixing the problems that had delayed the models’ launch. A year later, Blume fired almost all of the top management and hired Bosch, who in turn changed priorities and revived internal development of the software that would take VW’s cars into the future.
How will Volkswagen’s $5 billion investment in Rivian impact the electric vehicle market?
Volkswagen’s Billion-Dollar Bet on Rivian: A Game-Changer for Electric Vehicles?
In a move that has sent shockwaves through the automotive industry, Volkswagen has announced a massive $5 billion investment in Rivian, an American electric vehicle startup. The partnership, which includes a joint venture to develop car software, control units, and network architecture, has sparked both excitement and concern among industry insiders.
A Risky Move for Volkswagen
Volkswagen’s decision to invest in Rivian is seen as a strategic move to bolster its electric vehicle offerings and stay competitive in the rapidly evolving market. By partnering with Rivian, VW hopes to leverage the startup’s expertise in software development and electric powertrains to accelerate its own electrification efforts [[1]].
However, the deal also raises concerns about the German automaker’s commitment to its own software development subsidiary, Cariad. Employees of Cariad fear that the partnership with Rivian could spell the end for their division, which has struggled with software development issues in the past [[2]].
Rivian’s Rise to Prominence
Rivian, which was founded in 2009, has quickly become a darling of the electric vehicle industry. With its innovative electric pickup trucks and SUVs, the company has captured the attention of investors and consumers alike. The partnership with Volkswagen is seen as a major coup for Rivian, which has been struggling to scale its operations and reduce its debt burden [[3]].
What Does the Future Hold?
The partnership between Volkswagen and Rivian has significant implications for the electric vehicle market. By combining their resources and expertise, the two companies could create a new generation of electric vehicles that are more efficient, sustainable, and technologically advanced.
However, the deal also raises questions about the long-term viability of Cariad and the impact on Volkswagen’s software development capabilities. As the partnership unfolds, it remains to be seen how the two companies will work together to achieve their goals and whether the investment will pay off for Volkswagen.
Volkswagen’s billion-dollar bet on Rivian is a bold move that could have far-reaching consequences for the electric vehicle industry. While the partnership holds great promise, it also raises important questions about the future of Volkswagen’s software development capabilities and the impact on its employees.
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