I'd like to think that I have a reasonably decent understanding of economics for a laymen, but in this case I'm a bit stumped.

Seems to me that for 5 billion dollar (+however much VW spent on their own software) you should be able to develop a good operating system for your own cars. But I guess VW somehow failed and now would rather license Rivians through this joint venture?

Is a car OS really that expensive and complex to develop? Especially when android auto and Apple car play will do a lot of the heavy lifting for most people.

Even with losses of nearly $40,000 for every vehicle it delivers, Rivian has been on a steadier footing than other EV makers that have been forced to slash prices to stimulate demand or file for bankruptcy protection.

Rivian's cash and short-term investments fell by about $1.5 billion in the first quarter to just under $8 billion.

Nearly 40k loss per vehicle? That seems insane. How has that company been going on until now? They also say that they even before this deal they had enough reserves to last until their next models release and things were moving up, but still that is seems like an absurd rate to burn cash.

I get that it sometimes makes sense for companies to burn through heaps of cash to scaley capture market share or drive out competition, but is the car manufacturing market at this point in time one where this play still makes any sense?