The electric vehicle manufacturer Rivian has secured a whopping $5 billion investment from the Volkswagen Group in a move that will help the company achieve its goal of profitability. This is especially so given that Rivian recently held an investor day event where the company’s top management provided an overview of the company’s strategy.

This will go a long way in helping Rivian to design and manufacture new electric vehicle models since it has so far only produced the R1T pickup truck and the R1S SUV.

The cooperation with Volkswagen is expected to be beneficial for Rivian not only financially. The two companies will work on creating a new EV platform which will be used by both Rivian and other Volkswagen Group’s brands.

This is to cut on costs and also speed up the development process for both firms. Rivian has the electric vehicle technology side while Volkswagen has the manufacturing and the distribution network, which could be very beneficial in the growing market for EVs.

During the investor day, Rivian’s management presented the plan to reach the profitability, which is especially important for the company given the competition from traditional car manufacturers and other new entrants in the EV market.

The company wants to use the Volkswagen investment in order to increase the production capacities of the current plant located in Normal, Illinois, as well as to consider the possibilities of opening new facilities in view of the increasing demand. Also, Rivian plans to cut down the cost of production by leveraging on the concept of economies of scale and better manufacturing efficiency.

The news has been welcomed by the investors and this is evidenced by the rise in the stock price of Rivian. This is a positive signal for Rivian and its technology and business model as one of the world’s largest automakers has invested in the company. It also makes Rivian better placed than Tesla and other traditional car makers who are also rapidly increasing their electric vehicle portfolio.

To achieve its growth strategy, Rivian intends to launch new models that will capture other market niches. Although details were not given, managers suggested that the company will launch products that will be cheaper than the existing ones.

The company also focused on the improvement of the advanced driver assistance systems and the research of autonomous vehicles, where cooperation with Volkswagen can be most effective.

The investment and partnership is timely given that the automotive industry is experiencing a shift in its development towards electric cars. As the governments all over the world are becoming more concerned about emissions and providing incentives for EVs, the market for EVs is projected to grow in the future.

This is where Rivian finds itself in a much stronger position after receiving the backing of Volkswagen and the potential to take advantage of this emerging market opportunity and position the company as one of the leading players in the global automotive sector.