Will Rivian be Volkswagen’s software savior? VW is betting $5.8B it will | TechCrunch
Welcome back to TechCrunch Mobility — your central hub for news and insights on the future of transportation. Sign up here for free — just click TechCrunch Mobility!
Before we jump into the news, I wanted to steer you toward a recent TechCrunch Equity podcast episode with Waabi co-founder and CEO Raquel Urtasun.
A little bird
Got a tip for us? Email Kirsten Korosec at [email protected], Sean O’Kane at [email protected] or Rebecca Bellan at [email protected]. Or check out these instructions to learn how to contact us via encrypted messaging apps or SecureDrop.
Deals!
The Rivian-Volkswagen Group joint venture has been officially finalized. Before the parties signed on the dotted line, it got about 16% bigger. The deal will now inject up to $5.8 billion into Rivian’s coffers with $1 billion already delivered via a convertible note.
We don’t know all of the specific terms, but it is worth noting that this will be an independent company co-led by Rivian’s head of software Wassym Bensaid and Volkswagen Group’s chief technical engineer, Carsten Helbing. The team, which will be heavily loaded with Rivian engineers, will be based in Palo Alto, California. It will eventually set up three more sites in North America and Europe.
A lingering question — and one asked by lots of media (including moi) during a press conference — is what happens to VW’s struggling software arm, Cariad? VW Group CEO Oliver Blume claims that Cariad will still play a “central role.” We’ll see.
Meanwhile, Rivian is still struggling with a supplier problem that curbed production and cut into revenue. In its Q3 earnings, Rivian reported $874 million of revenue, more than 34% lower than the same period last year. But looking at the gap between production (13,157) and deliveries (10,018) suggests that demand is also an issue.
That VW money is looking pretty sweet right now.
Other deals that got my attention …
Just Eat Takeaway, the Netherlands-based food delivery company, is selling its U.S. business Grubhub to New York-based Wonder Group in a deal valued at $650 million. That’s 91% less than the $7.3 billion Just Eat Takeaway paid for the company just four years ago.
Silicon Valley battery startup Lyten is acquiring manufacturing assets from Northvolt, the Swedish battery manufacturer that has struggled in recent months and is short on capital. The companies didn’t disclose financial terms but did say Northvolt will sell manufacturing equipment it inherited in its 2021 acquisition of Cuberg, another battery startup.
NASA gave out five research awards worth $11.5 million to companies working on sustainable aircraft concepts, including JetZero.
Vatn Systems, a Portsmouth, Rhode Island-based company developing underwater autonomous vessels, raised $13 million in a seed round led by DYNE Ventures and with participation from Lockheed Martin Ventures, RTX Ventures, In-Q-Tel, and others. The round brings the startup’s total funding to $16.5 million.
Vecna Robotics, a warehouse robotics startup that developed autonomous forklifts and other pallet movers, has raised $14.5 million. But the raise wasn’t exactly what got my attention; it was the appointment of Karl Iagnemma, the former president and CEO of Motional. Iagnemma has been in the AV world for a couple of decades now, largely in pursuit of commercializing autonomous vehicles (i.e., robotaxis). This new position puts him at the helm of a startup (in which he was an early investor, btw) that already has commercial customers.
Notable reads and other tidbits
Autonomous vehicles
Monarch Tractor, the autonomous electric tractor startup, has laid off workers as part of a restructuring that will see it prioritize non-agricultural customers, license its autonomous technology, and boost sales of its AI-powered farm management software. Got a tip about Monarch? Reach out to Sean O’Kane at [email protected].
Yelp agreed to buy RepairPal, a site for car repair estimates, for $80 million in cash. The acquisition is expected to close by the end of the year, subject to customary closing conditions.
Waymo dropped its waitlist in Los Angeles, opening the robotaxi service up to the public. The service area is now about 80 square miles of Los Angeles County.
Welp, Zoox co-founder and CTO Jesse Levinson told us at Disrupt 2024 that the Amazon-backed company’s custom robotaxi would be hitting the streets of San Francisco and Las Vegas. And now they have officially arrived. These are just for employees right now and will eventually be opened up to invited members of the public.
Electric vehicles, charging, & batteries
Canoo keeps trying to hold on, but its prospects don’t look great. The EV startup-turned-SPAC told shareholders in its Q3 earnings “it must continue to take aggressive actions to consolidate our operations, reduce costs, and catch-up to our plan.” As part of that plan, Canoo’s exec team, which includes chairman and CEO Tony Aquila and new CFO Kunal Bhalla, will take “short-term pay cuts for long-term incentives.” Reminder: Aquila’s firm has lent Canoo money, and among the terms is an 11% interest rate.
In other Canoo news, the company tested its electric vans for Walmart without airbags despite warnings from employees, sources told Fortune.
Lucid started taking orders for the Gravity SUV. If it wasn’t already clear, Lucid’s future hinges on the success of this EV.
Tesla issued a recall for more than 2,000 Cybertrucks, the sixth since the EV launched a year ago. And no, it’s not one that can be fixed by a software update. Speaking of Tesla, the automaker is part of the trillion-dollar club (market cap) again thanks in part to shareholders betting a Trump presidency will benefit the company led by ally Elon Musk.
Future of flight
Exosonic, a startup developing supersonic commercial air travel and UAV tech, said it is shutting down after failing to find the capital needed to continue operations.
This week’s wheels
This week, I’m back with a couple more Waymo robotaxi tales from TechCrunch staff members who had their first rides while in San Francisco for Disrupt 2024. As I mentioned last week, I’ve been in loads of autonomous vehicles, including driverless Waymos, so I thought it would be fun to share some first-timers’ views.
From UK-based reporter Paul Sawers: “While I’ve written about the autonomous vehicle industry for many years, taking my first ride in an actual self-driving car was pretty mind-blowing — it felt like I’d been catapulted into the future. I couldn’t help but stare at the empty driver’s seat and marvel at the fact that we were maneuvering through the streets of San Francisco. It wasn’t hugely nerve-wracking, but that’s probably because we weren’t going much faster than about 25 to 30 miles per hour. I suspect if I was on the highway in that thing, it might be a little more hairy.
More broadly, there was something a little jarring about seeing all these humanless cars creeping around street corners— marginally dystopian, like the machines were finally taking control.”
From reporter Rebecca Bellan: “I rode in as many Waymos as I could during the week of Disrupt, and it felt sort of like a ride at Disneyland. It moved slow and cautiously, and I wasn’t really worried about crashing. Most rides went without incident, barring one in which the robotaxi looked poised to drive towards a pedestrian but then thankfully swerved.
“My main gripe is that the vehicles often began to drive off before you reached them, likely due to a lack of access to city curbsides. I’m not sure how the ‘Driver’ decides it’s time to drive half a block up and wait there instead, but this little exercise had my editor Kirsten and I chasing one down a couple of blocks and a (thankfully well-lit) alleyway before we could come aboard.”
Senior reporter Sean O’Kane wrote: “I’ve covered AVs long enough that I expected my first taste of Waymo’s careful rollout to go super smoothly — and it did. I did not expect to feel so viscerally just how expensive these current vehicles are, from the whirring lidars to the high-price I-Paces. I’m excited to ride again someday soon, but I hope by then Waymo will have made more progress on making a viable business.”
What is “This week’s wheels”? It’s a chance to learn about the different transportation products we’re testing, whether it’s an electric or hybrid car, an e-bike, or even a ride in an autonomous vehicle.
