Volkswagen & Rivian May Market Their Zonal Software To Other Automakers

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This seems impossible, but the cooperation between Volkswagen Group and Rivian to develop software for electric vehicles is going so well that the two companies are thinking they could market their digital expertise to other automakers. Is this the same Volkswagen that has floundered for nearly a decade to get its software to work properly? The same company that created CARIAD, a new software division, then fired all the senior executives and started over from scratch before finally throwing in the towel and outsourcing the task to Rivian? That Volkswagen?

The answer, according to the Detroit News, is “Yes!” It reports that the joint venture created by Volkswagen and Rivian — known as RV Tech — has made great progress toward delivering the EV electrical and software platform that Volkswagen Group needs to compete with Tesla and Chinese automakers.

RV Tech is focused on delivering software systems for Rivian and Volkswagen, but is open to talking to third parties about using those platforms, which are designed to be scalable across vehicle sizes and segments in Western markets.

“We’re solving a problem for the larger automotive industry,” Wassym Bensaid, Rivian’s software chief and RV Tech co-chair, told journalists at an event in Palo Alto, California, on November 12, 2025. “That could become an opportunity” for others as well, he said. “There’s no Rivian versus VW versus Audi. It’s Rivian, and Audi, and VW, and potentially in the future other OEMs because of the breadth and scalability of the technology solution that we’re building.”

RV Tech Sees Licensing Opportunities

The earning potential from licensing the technology “is a very different ballgame and a very different margin profile from a business standpoint than making cars,” Bensaid said. RV Tech also said it will begin testing the system soon in winter conditions on Audi, Volkswagen, and Scout models, starting in the first quarter of 2026.

Volkswagen is grappling with tariffs in the US, shrinking deliveries in China, and muted demand in Europe. As part of its push to cut costs and bolster sales, it has turned to Rivian for the kind of software and EV technology its initial battery-powered models were missing. The automaker is investing as much as $5.8 billion in the alliance, making it one of Volkswagen Group’s biggest strategic bets ever.

Two months ago, Germany’s Manager Magazin reported that the relationship between Rivian and Volkswagen is experiencing some turbulence. “Volkswagen is reportedly encountering extensive problems in its partnership with Rivian. As a result, electric models intended to run on Rivian software are apparently delayed. Furthermore, Rivian’s algorithms cannot simply be transferred to internal combustion engines, which Volkswagen now seems likely to keep in the line-up for longer,” it wrote.

Highly placed sources said Audi’s Q8 e-tron SUV and A4 e-tron may be delayed by at least a year, moving their launch date back to mid or late 2028. The debut of Porsche’s K1 SUV, which is supposed to be a battery electric model positioned above the Cayenne due in showrooms by late 2027, is now postponed indefinitely.

There was even a suggestion in that report that CARIAD, bloodied and bruised by constant corporate infighting and upheavals, might be resurrected, as Volkswagen Group CEO Oliver Blume tries to find someone — anyone — who can solve the company’s ongoing software issues.

Zonal Architecture

When the joint venture was created a year ago, it brought together software developers and engineers from both companies. Like Tesla, BYD, and Xiaomi, RV Tech is using zonal architecture which requires fewer individual controllers to oversee a wider range of functions in the car’s front, central, and rear sections, thus reducing costs for both companies. For Rivian, which has yet to become profitable, the investment from Volkswagen Group is a financial lifeline as demand for electric vehicles softens for a number of policy reasons.

While RV Tech is putting a priority on ramping up and delivering software platforms for electric models, there are parallels that would allow the technology to be used for combustion engine cars as well, co-chair Carsten Helbing told the press last week.

Rivian R2 First Up

The first vehicle to use the new technology will be the R2 sport utility vehicle from Rivian that’s expected to debut in the first quarter of 2026. The first Volkswagen product to use it will be the ID.1 that is on track to appear in 2027. That compact EV is expected to sell for about €20,000 ($23,000) in Europe, where it will compete with the new battery electric Twingo from Renault and a number of low-cost models from Chinese manufacturers.

After the ID.1 goes on sale, the next vehicles from Volkswagen to use the software package from RV Tech will be the new pickup truck and SUV from Scout Motors, perhaps in 2028. Those vehicles were intended to be battery electrics until the Moron of Mar-A-Loco blew into town and snuffed out every forward-leaning program in existence in the US. That caused Volkswagen to rethink its sales strategy and add plug-in hybrid powertrains to the Scout mix.

It could have been worse. The German company could have revived its turbo diesel powertrains for its Scout models. The question now is whether those plug-in hybrids will have wimpy little batteries that condemn the vehicles to relying on their internal combustion engines most of the time, or whether they will have enough battery-only range to qualify as true PHEVs that use the electric motor primarily and keep the gas engine in reserve for occasional use.

There is no suggestion in the current reporting that the disruptions Manager Magazin reported are holding up progress. Apparently, the software platform is now capable of supporting at least plug-in hybrid architecture, which could be a big plus for the joint venture as it explores the possibility of marketing its software to other companies. Plug-in hybrids are the new darlings of the automotive world, as enthusiasm for battery-powered cars cools.

Volkswagen’s earlier efforts to develop software in-house largely stumbled, first by holding up launches of its namesake brand’s ID models, then by handicapping sales of those vehicles because of buggy features. Volkswagen Group, which also includes Audi and Porsche and a handful of other brands, has seen EV sales rise in Europe this year after improving software and updating models, Bloomberg says.

Software-defined vehicles are relatively new to the world of automobiles, and many legacy automakers are finding it hard to incorporate digital systems into their cars. Volkswagen has been out in left field now for almost a decade. Has it finally turned the corner and gotten on a path that could see it selling software systems to other manufacturers? That would be quite a turnaround indeed.