Volkswagen’s $5 billion bet on Rivian gets influencer attention on X, reveals GlobalData

Volkswagen (VW) and US-based electric vehicle (EV) startup Rivian Automotive have emerged as trending companies among the influencers on social media platform “X,” following the German automaker's announcement of a strategic investment of up to $5 billion in Rivian.

This partnership is perceived as mutually beneficial wherein Volkswagen secures access to Rivian's advanced software-defined vehicle architecture while Rivian obtains essential capital to sustain its operations and support future development, reveals the Social Media Analytics Platform of GlobalData, a leading data and analytics company.

Shreyasee Majumder, Social Media Analyst at GlobalData, comments: “Influencers view the VW-Rivian joint venture and investment as a critical lifeline for Rivian, averting potential bankruptcy and enabling expansion into new vehicle segments. They emphasize that the financial injection will positively impact Rivian’s production capabilities and market position, potentially paving the way for future collaborations and shared platforms with Volkswagen’s new electric SUV lineup. However, some influencers remain uncertain about the long-term success and sustainability of the partnership."

Below are a few popular influencer opinions captured by GlobalData’s Social Media Analytics Platform:

  1. Alex Voigt, Author:

“The joint venture with Rivian is an almost risk-free, no-brainer deal for VW but could be a write off later too. Details show that the agreement is a very good deal for VW, but the desperation of Rivian also shows that without this agreement the company might have gone bankrupt very soon. The contract terms for Rivian are very bad and it is questionable how long the lifeline VW has thrown will keep the company afloat. VW will buy Rivian for $10.83 per share. That means almost 100 million shares for $1 billion or ~10% dilution and 4.75% interest on top. To name just one example of many that shows that due diligence is not VW's favorite skill: the company has written off 1.9 billion dollars that it invested in Argo AI before 2022. At that time they made a huge press release how VW vehicles will drive with Argo AIs software fully autonomously. Well that didn't end well.”

  1. Gary Black, Managing Partner at The Future Fund LLC:

“With $VOW as their strategic partner, $RIVN bankruptcy risk - to the extent some investors worried about it - is now off the table.  The $3B cash investment (plus $2B for the new software JV) should remove the deep 2024 EV/Rev valuation discount at which $RIVN trades (3.3x AH) vs $TSLA (5.9x). $RIVN can now move downstream and construct their new factory in Georgia to expand their TAM to the affordable luxury segment with R2 ($45K ASP) and to the mass segment with R3 ($35K ASP).  Once $VOW converts $3B in new convertible notes to $RIVN equity, we estimate $VOW will own 15-20% of RIVN.”

  1. Sean O'Kane, Senior Transportation Reporter at TechCrunch:

“Very big, very interesting deal (investment + new joint-venture) here between @Rivian and @VWGroup Rivian gets more $$ and institutional support in uncertain times, and VW gets badly-needed software help. Will it work out?”

  1. Jesse Jenkins, Assistant Professor at Princeton University:

“Huge news for @Rivian! @VW to invest up to $5 billion in the EV startup, helping fund development of the R2 SUV, while VW gains access to Rivian's software-defined vehicle architecture. This is an important capital infusion for Rivian that helps them cross the Valley of Death to reach scale and positive gross margins. Will we even see further collab on a shared platform for VW's new "rugged" Scout brand of electric SUVs coming soon?”

  1. Ross Gerber, President and CEO at Gerber Kawasaki Wealth & Investment Management:

“Great news for Rivian. VW investing $5 bil which will keep them afloat for some time. The vehicles are great but they do need some operational help. This could be the way... $RIVN”