German car making giant Volkswagen (VW) says it will invest up to $5bn (£3.94bn) in Tesla rival Rivian.
The deal creates a joint venture that will allow VW and the US-based electric vehicle (EV) maker to share technology.
Rivian shares jumped by almost 50% after the announcement.
The tie-up comes as competition intensifies between EV makers and Western countries move to impose tariffs on Chinese imports.
Under the agreement, VW said it will initially invest $1bn in the electric truck and SUV maker, with another $4bn to be put into the company by 2026.
Founded in 2009, Rivian has not yet posted a quarterly profit. In the first three months of 2024 the company saw a net loss of more than $1.4bn.
VW, like other motor industry giants, has come under pressure from rivals like Tesla and China’s BYD as it tries to make the shift from fossil fuel-powered vehicles.
Meanwhile, some EV start-ups have struggled to make headway in the highly…
