Group written casetopic which stock to buy tesla or rivian

NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ADVANCED EDUCATIONAL PROGRAM -*** - GROUP WRITTEN CASE TOPIC: Which stock to buy: Tesla or Rivian Group’s members: Nguyen Huong Giang - 11201092 Nguyen Viet Hoang - 11201605 Nguyen Quang Huy - 11206679 Tran Thi Thu Huyen - 11201899 Nguyen Quoc Khanh - 11205608 Phung Nhat Minh - 11202585 Pham Minh Quan - 11206679 Bui Ngoc Vy - 11207490 Class: Advanced Accounting 62 Lecturer: Deane Van Pham, Ph.D Ha Noi, 2023 TABLE OF CONTENTS I INTRODUCTION 1.1 General information of Tesla .3 1.2 General information of Rivian .3 II PESTLE 2.1 Tesla .4 2.1.1 Political Factors 2.1.2 Economic Factors 2.1.3 Social Factors 2.1.4 Technological Factors 2.1.5 Legal Factors 2.1.6 Environmental Factors 2.2 Rivian .9 2.1.1 Political factors 2.1.2 Economic factors 10 2.1.3 Social factors: 11 2.1.4 Technological factors 12 2.1.5 Legal factors 12 2.1.6 Environmental factor: 13 2.3 Summary .14 III FIVE FORCES STATEGY .15 3.1 Tesla .15 3.1.1 Threat of New Entrants (Moderate force): 15 3.1.2 Bargaining Power of Suppliers (Weak force): 16 3.1.3 Bargaining Power of Buyers (strong force) 16 3.1.4 Threat of Substitute Products or Services (Strong force): .17 3.1.5 Intensity of Competitive Rivalry (Strong force): 17 3.2 Rivian 18 3.2.1 Threat of New Entrants (Strong force) 18 3.2.2 Bargaining Power of Suppliers (Moderate force) .18 3.2.3 Bargaining Power of Buyers (Moderate force) 19 3.2.4 Threat of Substitutes (Strong force) 19 3.2.5 Industry Rivalry (Strong force) 20 3.3 Summary .20 IV FINANCIAL ANALYSIS 21 4.1 Income statement 21 4.2 Balance sheet .21 4.3 Criteria 22 4.3.1 Growth: 22 4.3.2 Profitability: 22 4.3.3 Efficiency: ROA 23 4.3.4 Solvency: 23 4.3.5 Liquidity: 23 V SWOT 24 5.1 Tesla .24 5.1.1 Strengths 24 5.1.2 Weaknesses 26 5.1.3 Opportunities 28 5.1.4 Threats 29 Summary 31 5.2 Rivian 31 5.2.1 Strengths 31 5.2.2 Weaknesses 32 5.2.3 Opportunities 32 5.2.4 Threats 33 Summary 34 VI CONCLUSION 35 VII REFERENCES 36 I INTRODUCTION 1.1 General information of Tesla Tesla, Inc is an American electric vehicle and clean energy company based in Palo Alto, California Tesla's current products include electric cars, battery energy storage from home to grid-scale, solar panels and solar roof tiles, as well as other related products and services In 2020, Tesla had the highest sales in the plug-in and battery electric passenger car segments, capturing 16% of the plug-in market (which includes plug-in hybrids) and 23% of the battery-electric (purely electric) market Through its subsidiary Tesla Energy, the company develops and is a major installer of solar photovoltaic energy generation systems in the United States Tesla Energy is also one of the largest global suppliers of battery energy storage systems, with GWh of battery storage supplied in 2020 Founded in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors, the company's name is a tribute to inventor and electrical engineer Nikola Tesla Elon Musk, who contributed most of the funding in the early days, has served as CEO since 2008 According to Musk, the purpose of Tesla is to help expedite the move to sustainable transport and energy, obtained through electric vehicles and solar power Tesla began production of their first car model, the Roadster, in 2009 This was followed by the Model S sedan in 2012, the Model X SUV in 2015, the higher volume Model sedan in 2017, and the Model Y crossover in 2020 The Model is the world's all-time best-selling plug-in electric car, with more than 800,000 delivered through December 2020 Tesla's global vehicle sales were 499,550 units in 2020, a 35.8% increase over the previous year In 2020, the company surpassed the million mark of electric cars produced Tesla has been the subject of numerous lawsuits and controversies arising from statements and acts of CEO Elon Musk, allegations of creative accounting, allegations of whistleblower retaliation, alleged worker rights violations, and allegedly unresolved and dangerous technical problems with their products 1.2 General information of Rivian Rivian Automotive, Inc., is an American electric vehicle manufacturer and automotive technology company founded in 2009 Rivian Automotive, founded by Robert "R.J." Scaringe is coming up fast in the rearview mirror of high-profile electric carmaker Tesla Inc (TSLA) Largely unknown outside of automotive circles, the privately-held maker of premium electric sport utility vehicles (SUVs) and pickup trucks has yet to sell a vehicle The company confidentially filed for an initial public offering on Aug 27, 2021 that valued the electric vehicle maker at around $80 billion, according to reports at the time Back then, Rivian expected to have an initial public offering (IPO) as soon as midNovember, according to Bloomberg On Nov 1, 2021, a variety of reports emerged indicating that Rivian now would seek a valuation ranging from $53 billion to somewhere above $60 billion The IPO may come to market as early as the week beginning on Monday, Nov 8, 2021, and trade on NASDAQ under the ticker symbol RIVN II PESTLE 2.1 Tesla 2.1.1 Political Factors Political factors can have a significant impact on Tesla and the electric vehicle industry Here are some political factors that may affect Tesla: a Government incentives and subsidies: Governments around the world have implemented various incentives and subsidies to encourage the adoption of electric vehicles and renewable energy For instance there are some countries offer tax credits or rebates to consumers who purchase electric vehicles while others provide funding for research and development in the electric vehicle industry The mentioned incentives can help make electric vehicles more affordable and increase demand for them which can benefit Tesla b International trade policies and tariffs: Tesla imports many of the parts and materials it uses to manufacture its vehicles, and changes in international trade policies or tariffs can affect the company's cost of production As an example if the US were to impose tariffs on imports from certain countries, it could increase the cost of production for Tesla c Environmental regulations: Governments around the world have implemented various regulations to reduce pollution and emissions from the transportation sector For example the European Union has implemented stricter emissions standards for vehicles which could impact the production and sales of Tesla's vehicles in the region Additionally, governments may set targets for the adoption of electric vehicles which could increase demand for Tesla's products 2.1.2 Economic Factors Economic factors are those that relate to the production and consumption of goods and services and the associated financial interactions Economic factors can impact businesses by influencing demand for their products or services as well as their costs of production Following are few economic factors that can impact Tesla: a Oil prices and demand for alternative fuel vehicles: As an electric vehicle manufacturing Tesla's products may be more attractive to consumers when oil prices are high as electric vehicles are generally cheaper to operate than gasoline powered vehicles On the other hand, low oil prices may make gasoline-powered vehicles more attractive to consumers which could negatively impact demand for Tesla's products b Consumer income and spending patterns: Tesla's vehicles are generally more expensive than traditional gasoline powered vehicles, and therefore may be out of reach for some consumers Changes in consumer income and spending patterns can affect demand for Tesla's products For example, if consumers are feeling financially secure and have more disposable income they may be more likely to purchase a Tesla vehicle c Competition from other automakers: Testa faces competition from other automakers that are also producing electric vehicles As the electric vehicle market grows it is likely that competition will increase which could impact Tesla's market share and profitability Document continues below Discover more from: Global business strategy 192 documents Go to course Unit 18 Global Business Environment Read 29 Global business strategy 100% (10) Ban-dich-glo-bus compress ànd strategies - NEU 32 Global business strategy 100% (6) Chipolet-Case-study 12 Global business strategy 100% (6) 10190480 GBE A1 - GBE 26 Global business strategy 100% (5) Nghiệp vụ ngoại thương 45 Global business strategy 100% (3) Case Study - Starbucks 27 Global business strategy 100% (3) d Interest rates: Changes in interest rates can affect Tesla's borrowing costs and, in turn its financial performance If Interest rates rise it could increase Tesla's borrowing costs and negatively impact its profitability 2.1.3 Social Factors Social factors are those that relate to the society in which a business operates, and can include cultural demographic and societal values and norms Here are some socialcultural factors that may impact-Tesla: a Consumer attitudes towards electric vehicles and sustainability.Tesla's products appeal to consumers who are environmentally conscious and are looking for sustainable transportation options Changes in consumer attitudes towards electric vehicles and sustainability could affect demand for Tesla's products b Changes in demographics and population growth: Changes in the makeup of a population such as an aging population or an increase in urbanization can affect demand for certain products For example, if there is an increase in the number of young, urban consumers, it could increase demand for Tesla's electric vehicles which are well-suited for urban environments c Workplace diversity and inclusion: Tesla has faced criticism for its lack of workplace diversity which could impact its reputation and potentially affect consumer demand for its products The company has stated that it is working to increase diversity and inclusion within its workforce d Consumer attitudes towards luxury brands: Tesla's vehicles are often positioned as luxury products and changes in consumer attitudes towards luxury brands could affect demand for its products e Social media: Social media can be a powerful tool for businesses to connect with consumers and build their brand but it can also be a source of negative publicity Tesla's CEO Elon Musk, is known for making controversial statements on social media which has sometimes had negative consequences for the company 2.1.4 Technological Factors Technological factors refer to the impact of technological developments on a business Here are some technological factors that may impact Tesla: a Advancements in electric vehicle technology and battery storage: Tesla is at the forefront of electric vehicle technology and is constantly working on improving the range and performance of its vehicles However, the company faces competition from other automakers that are also investing in electric vehicle technology b Increased use of renewable energy sources: As the use of renewable energy sources increases, it could reduce the demand for fossil fuels and make electric vehicles more attractive to consumers This could increase demand for Tesla's products c Development of autonomous driving technology: Tesla is also working on developing autonomous driving technology which could potentially revolutionize the transportation industry However, the company faces competition from other tech companies and automakers that are also working on autonomous driving technology d Increased use of online sales and marketing: Tesla has embraced the use of online sales and marketing which allows the company to reach a wider audience and streamline its sales process e Increased use of data analytics: Tesla uses data analytics to improve its operations and to gather insights about consumer behavior The company also collects data from its vehicles through their on-board computers which it uses to improve its products and services 2.1.5 Legal Factors Legal factors analysis of Tesla Inc can involve identifying and evaluating the potential legal risks and opportunities facing the company This may involve considering the following factors: a Government regulations: Tesla must comply with a range of laws and regulations relating to the production sale and use of its products This includes environmental regulations safety standards, and consumer protection laws It is important for the company to stay up-to-date with these regulations and ensure that it is in compliance as non-compliance could result in fines, legal action, or reputational damage b Intellectual property: Tesla has a significant portfolio of patents and trademarks and must protect these assets to ensure that its products and technologies are not copied or used without permission The company may also face lawsuits from third parties alleging infringement of their intellectual property rights, which could be costly and time- consuming to defend c Environmental regulations: Tesla's manufacturing processes and products have an impact on the environment and the company must comply with various environmental laws and regulations This may involve obtaining permits and approvals and may also expose the company to potential lawsuits related to environmental damage or pollution d Labor and employment laws: Tesla must comply with various labor and employment laws including those relating to hiring wages working conditions and employee benefits The company may also face labor disputes and lawsuits related to these issues e Competition: Tesla operates in a highly competitive industry, and must compete with other companies for market share, resources, and talent The company may face competition from both established players and new entrants and must be prepared to respond to changing market conditions and consumer preferences 2.1.6 Environmental Factors Following are the environmental factors that could impact Tesla including government regulations competition from other electric vehicle manufacturers and the availability of resources needed to produce electric vehicles The first and foremost major regulatory factor that could impact Tesla is the imposition of emissions and fuel economy standards Electric vehicles, such as those produced by Tesla have zero tailpipe emissions and can help to reduce a country's overall greenhouse gas emissions Therefore, Governments around the world have begun to billion This resulted in a net loss of $1.5 billion in 2021 Rivian has invested in manufacturing facilities, research and development, and marketing Rivian is reliant on equity The company's debt is relatively high compared to its assets This could make it difficult for Rivian to raise capital if demand for electric vehicles declines Overall, Rivian's balance sheet shows the company is in a growth phase but is also reliant on equity The company will need to continue making significant investments in growth to be successful in the long term 4.3 Criteria 4.3.1 Growth: Revenue (in billions) Tesla $10.4 (2017) Rivian $0.4 (2017) Net income (in billions) Deliveries (in thousands) $2.2 (2017) 76,230 (2017) -$3.7 (2017) (2017) 53.4% 38.2% 119.7% 128.1% -137.7% 222.5% Revenue growth (CAGR) Net income growth (CAGR) Deliveries growth (CAGR) Tesla: sustainable growth for those past years and will grow even bigger in the future in regard to their R&D that they are showing to everyone Rivian: Sales grow almost 3000% in the year 2022 this could be a hit for investors to invest in this new-on-stock-market company 4.3.2 Profitability: Tesla Rivian Gross profit (in billions) Gross profit margin (%) $14.3 (2022) 55% (2022) $2.1 (2021) -38% (2021) Net income (in billions) Net income margin (%) $9.53 (2022) 37% (2022) -$1.5 (2021) -27% (2021) 22 Tesla: Gross profit margin is 25.60% for 2022, they are producing money when offering their products at a good price Utilization of capital: Return on Equity (ROE): 26.81%, ROCE: 26.9% Rivian: Gross profit margin is -199.03%, Rivian is investing heavily in research and development, which is driving up costs Utilization of capital: ROE: -124.3%, ROCE: -109.8% 4.3.3 Efficiency: ROA Year Tesla Rivian 2022 2021 37% -27% \ -38,45% 2020 2019 -13.5% -11.8% -49,91% -28,12% 2018 -14.5% -99% 4.3.4 Solvency: - Gearing: Tesla: 0.67, Rivian: 1.44 Year 2022 Tesla 0,67 Rivian 1,44 2021 2020 0,64 0,59 1,53 1,62 2019 2018 0,54 0,49 1,71 1,79 Rivian is depending on debt to fund its activities 4.3.5 Liquidity: Company Tesla Net Cash Flow (in millions) Free Cash Flow (in millions) $-1.22 billion 23 $4.53 billion Rivian $-2.44 billion -$1.34 billion Rivian’s Stock could be more valuable to buy now because of its price and its trend of increase lately Furthermore, it is funding huge in R&D and this would benefit the investor for holding its shares Tesla’s stock is always worth buying It is safer for investor but big company can not make bigger margin compare to new company Tesla’s indicators are absolutely beautiful as its real activities are shown to everyone V SWOT 5.1 Tesla Tesla, Inc is by far one of the most well-known companies in the world As a testament to this fact, the mention of the name is more likely to conjure up images of its eccentric CEO and electric vehicles than Nikola Tesla, the famous inventor 5.1.1 Strengths Let’s take a look at some of the factors which make Tesla, Inc one of the most valuable companies in the world 24 a Impressive Hiring Strategy: Musk's CEO prioritizes talent and experience over academic credentials in Tesla's hiring process The company uses a two-step process, with the first stage resembling an interview, emphasizing experience in relevant fields Applicants pass the first stage and move on to the second phase, which involves practical sessions to test their abilities This strategy benefits highly technical fields like engineering, as experience is more valued than theoretical knowledge, leading to more productive workers Additionally, hiring staff with hands-on experience reduces training costs allowing Tesla to hire the best at the least cost b Strong Brand Value and High Market Capitalization: Tesla's market capitalization is $547 billion, making it the seventh most valuable company globally Despite its lower peak value of $1.06 trillion in 2021, it remains a safe investment with strong long-term growth potential The brand's value is $76 billion in 2023, nearly double its 2022 valuation Several key factors are driving both of these figures  The company is considered a good investment for risk-tolerant investors;  The brand represents the future of fully autonomous driving;  Tesla has always been at the forefront of a wide range of technological innovations; and  It has a strong competitive advantage and market dominance over even its closest industry rivals c A Phenomenal Organizational Structure: Elon Musk's less-conventional leadership methods have positively impacted Tesla's organizational structure, which combines functional and divisional structures The company's success can be attributed to Musk's hands-on approach and unorthodox rules, which contribute to its unique hierarchical structure These include: Avoiding frequent and unnecessary meetings; Exiting a meeting once you no longer add or receive value from the gathering; and Avoiding rigid and cumbersome communication channels 25 d Unique Brand Positioning and Superb Marketing Strategy: Tesla is a unique and valuable brand with debates surrounding its role as an auto manufacturer and tech company With its expansion into secondary markets like solar energy and electric batteries, Tesla is increasingly focusing on sustainable technology Despite spending minimal on branding and marketing, the company has positioned itself as the face of the future of the auto industry and sustainable technology globally e Strong Innovative Capacity: Tesla is known for its innovation and early adoption of green energy technology Key examples include their mid-to-high-end electric vehicles, supercharging stations, Tesla Solar Roof, Tesla Powerwall, and the revolutionary Tesla autopilot, which may be the first step towards driverless vehicles These advancements make electric vehicles more accessible and convenient for long-distance transport Tesla, with a higher market capitalization than automakers like General Motors, Toyota, Ford, and Volkswagen, is the top manufacturer of electric vehicles globally In 2021, the company sold over 900,000 electric vehicles, with the Model being its most popular product f Its Charismatic CEO: Elon Musk's revolutionary vision and transformational leadership style have led to the success of Tesla and the world's richest man Despite facing challenges in business and technology, Musk has overcome them through visionary leadership, a strong work ethic, and a relentless pursuit of his objectives Analysts believe Musk's visionary leadership and obsession with achieving his objectives have contributed to the company's popularity and investor confidence Tesla capitalized on a market shift towards greener technologies like electric vehicles, solar roofs, and batteries, making them an integral part of their brand, symbolizing present and future 5.1.2 Weaknesses Despite all its strengths, there are still some areas the company is lacking in They include: a Frequent Manufacturing Delays: Tesla faces frequent manufacturing and distribution delays due to its sophisticated technology and complex logistics This issue is particularly 26 evident in electric vehicles, where multiple supply chain delays can prevent new deliveries The Tesla Solar Roof also faces delays, causing months-long installations Despite the skilled workforce and innovative manufacturing process, Tesla faces challenges in maintaining its competitive edge b Setting Overly Optimistic Targets: Tesla, known for producing revolutionary technologies, has faced accusations of being overconfident and deceptive Musk has faced accusations of promising battery capabilities that contradict physics laws The company has also faced backtracks on self-driving cars, failed production automation, delays with the Tesla semi-truck, and the controversial Tesla bot These controversies have tarnished Tesla's reputation and reduced its reliability to investors c Unusually High Employee Turnover Rate: Elon Musk's leadership strategy and talent identification skills have led to a high employee turnover rate, particularly among executive staff Tesla's executive turnover rate was estimated at 27% in 2019, higher than the 15% cohort average However, the executive turnover rate of staff reporting directly to Musk was 44%, significantly higher than the industry average of 9% This highlights Musk's tendency to let go of employees who displease or disappoint him, potentially causing the company's downfall d A Controversial Chief Executive Officer: Elon Musk, a visionary CEO at Tesla, has faced controversies and lawsuits, leading to concerns about his company's future His $44 billion Twitter takeover, political views, and lawsuits have led some to question the suitability of a prominent CEO for public companies Despite the tech industry slump, many shareholders view these controversies as a significant factor in Tesla's losses e The Cost of Their Products: Tesla, a leading technology company, charges high prices for its products, despite Musk’s goal of making sustainable technologies affordable The base models of Tesla cars range from $43,990 to $129,990, making them a significant investment for buyers The company’s high prices are attributed to factors such as the cost of electric batteries, which make up over 50% of the car’s cost, and the company’s struggle to meet demand for electric vehicles f Restricted Output Leading to an Inability to Meet Demand: Tesla struggles to meet product demand, resulting in long waiting times and inflated prices This strategy may be a deliberate attempt to create exclusivity, but may backfire as other companies increase electric vehicle production, offering cheaper and more accessible alternatives Tesla's 27 limited electric vehicle line, including four basic models and a semi-truck, is unusual in the industry, where most companies aim to cater to various buyer types g Open-Source Patents: Tesla's open-source patent strategy allows the company to capitalize on third-party improvements to its technology, but also risks losing exclusive proprietary rights to innovations it invested heavily in 5.1.3 Opportunities Let’s explore some areas the company could invest in, in order to further expand its dominance in the market a Introducing Its Products to New Markets: Electric vehicle sales have increased significantly, but they still outnumber traditional fossil fuel-driven vehicles in many regions Europe and China dominate sales, with the US having a low percentage To improve the customer base, companies should invest in promoting electric vehicle sales in the US, Asia, and Africa b Improving the Affordability of Their Vehicles: Tesla can reduce its high electric vehicle prices by shifting its image from high-end luxury to offering a broader range of products To maintain its dominance, Tesla must compete with cheaper fossil fuel alternatives from Toyota and General Motors, as well as other manufacturers offering affordable electric vehicles Musk has promised a $25,000 Tesla model, but plans for this mid-range electric vehicle have not materialized c Improving Their Autonomous Driving Technology: Tesla's driverless technology strategy has been a primary value proposition, with a self-driving beta program launched in 2020 Despite initial controversies, such as using untrained consumers as test subjects, software issues, and backlash, Tesla has made significant improvements to its technology Being the first company to provide truly driverless vehicles would further establish Tesla's dominance in the market d In-house Battery Production: Tesla vehicles and other products are not manufactured from scratch in the warehouse Third-party tech companies produce vital components, including the battery, which is crucial for Tesla products Outsourcing these components 28 increases the risk of supply chain disruptions and delays Tesla should make battery production in-house to gain better control over the manufacturing process e Maintaining Its Reputation as the Champion of Innovation: Tesla's brand image is heavily influenced by its innovation-driven approach, which relies on leadership, financial backing, and a skilled workforce To maintain this position, the company must continue focusing on continuous growth and development f Supporting the Shift Towards Renewable Energy: Tesla, a radio company, supports sustainable manufacturing practices and business practices By leveraging its high brand equity and unique selling proposition, the company can position itself at the forefront of a green future 5.1.4 Threats Let’s examine some of the potential challenges to the Tesla business model a Increasing Competition from Other Top Automakers: Tesla, a pioneer in the electric vehicle market, has gained attention due to its unique brand position and technological advancements However, with the entry of major automakers like Ford, Chevrolet, Hyundai, and Kia, Tesla's market dominance has waned Despite this, Tesla continues to outpace competitors in pure sales The question remains about Tesla's ability to maintain its advantage amidst rising competition, customer dissatisfaction, and cheaper alternatives b The Distraction Posed By Its Very Prominent CEO: Elon Musk is a key figure in Tesla's success story and brand image However, recent events suggest that his celebritylike status may be detrimental to the company's long-term success Many investors and customers are suggesting Musk step aside, while the company employs a traditional CEO who works behind the scenes While Musk appears to have taken a step back from the limelight, it's likely that he will face another public controversy in the future c The Uncertainty Surrounding Rare Earth Metals: Industry supply constraints, such as those faced by Tesla, can impact the production of electric vehicles and solar panels Rare earth metals like cobalt, nickel, and neodymium are crucial components of these technologies Supply shocks, trade wars, and pricing fluctuations can pose significant 29 risks to tech companies' ability to obtain these materials Tesla is not immune to these challenges, as recent trade wars between the US and China threaten the continued supply of these raw earth metals d The Legal Intricacies of Self-driving Vehicles  Driverless cars are a new, untested technology that requires thorough testing, vetting, regulation, and understanding of legal implications Legal issues arise with widespread electric vehicle use These include:  Driverless cars require real-life testing to ensure their capabilities in critical situations, potentially endangering test subjects' lives;  Proponents of driverless cars claim they are safer alternatives, but no consensus exists on the level of safety needed for widespread adoption;  Conventions like the Geneva convention lack international law regulating self-driving cars, as they assume people will drive all vehicles, resulting in no regulation for driverless vehicles;  Determining civil liability for driverless cars is crucial in cases where they cause damages while fully autonomous Manufacturers bear liability, while drivers are held liable if in control Determining the level of autonomy is crucial;  Determining criminal liability is crucial for both drivers and manufacturers in criminal offenses like reckless driving In fully autonomous mode, the manufacturer bears liability, except for hardware or software tampering by the driver;  Discussing insurance claims and vehicle insurance between drivers and vehicle manufacturers is crucial for self-driving technology advancements, whether in public or private fleets;  Data protection and privacy are crucial issues for driverless vehicles, as tech companies handle users' private information with legal, moral, and safety implications Proper handling is essential for widespread adoption;  Cybersecurity is crucial for fully autonomous vehicles, as compromised software can cause significant harm and national security concerns Widespread cyberattacks involving hundreds or thousands of vehicles can lead to significant loss of life and property e Changing Government Policy and Public Opinion on Green Energy: Global shocks have prompted governments, citizens, and corporations to reconsider the approach to sustainable energy, including renewables and electric vehicles Tesla's heavily subsidized technologies may face a drop in funding and support, potentially harming the company 30 This shift in public sentiment could impact the company's ability to adapt to changing energy needs Summary Tesla, a niche automaker and technological innovator, has overcome challenges and breakthroughs to become the market leader in electric vehicles and a force in sustainable technology Despite facing scandals and challenges, Tesla has left a lasting impact on the tech world, proving that innovation and perseverance are key to success 5.2 Rivian 5.2.1 Strengths a Investment from Major Companies: Rivian has received substantial financial backing from prominent corporations like Amazon and Ford, providing the startup with a strong financial base to develop further b Innovative Technology: Rivian has developed a groundbreaking electric vehicle platform that incorporates a skateboard design, merging the battery pack, electric motor, and suspension system into one cohesive unit This design offers advantages such as a low center of gravity, improved weight distribution, and exceptional off-road performance c Strong Leadership Team: Rivian is led by a team of experienced automotive executives who have worked for companies such as Ford, Tesla, and General Motors This team has a proven track record of building successful companies and bringing new products to market d Focus on Sustainability: Rivian has prioritized sustainability and eco-friendliness in the design of its electric vehicle platform The company utilizes recycled materials and has established a closed-loop system for battery recycling, ensuring a more environmentally conscious approach to manufacturing and disposal processes 31 5.2.2 Weaknesses Along with strengths, Rivian Automotive, Inc also has some weaknesses that investor should consider a Limited production capacity: Due to its limited production capacity of approximately 150,000 vehicles per year, Rivian's factory in Normal, Illinois may face challenges in meeting the growing demand for its vehicles This issue becomes particularly relevant if the company intends to expand its operations globally b High cost of production: The cost of production for Rivian's electric vehicles is high due to the expensive materials used and the new technology incorporated This makes it hard for the company to compete with other mainstream vehicle manufacturers who offer similar vehicles for a lower price c Supplier issue: As a new player in the automotive industry, Rivian is heavily reliant on its suppliers for the production of its electric vehicles This dependence can be a weakness as any disruption in the supply chain could negatively impact the company's production and profitability d Brand awareness: As a relatively new company, Rivian faces the challenge of limited brand recognition With fewer people being familiar with the company, it becomes more difficult to establish a strong presence and gain traction in the highly competitive automotive industry Building brand recognition becomes crucial for Rivian's success in the market 5.2.3 Opportunities Opportunities in the automotive industry are numerous, and Rivian Automotive, Inc (RIVN) does not fall short of them Some of the opportunities that Rivian can seize on are: a Increasing demand for electric vehicles markets: With the global shift towards a more environmentally friendly and sustainable future, there is a growing demand for electric vehicles (EVs) Rivian, with its lineup of all-electric vehicles, has the opportunity to capitalize on this expanding market and secure a substantial portion of it 32 b Expansion of charging infrastructure: While the availability of charging infrastructure remains a significant concern for electric vehicle (EV) owners, it is a challenge that is being addressed and improving rapidly Governments and private organizations are making substantial investments in the development of electric charging stations, aiming to expand the network and enhance accessibility for EV owners Rivian can capitalize on this trend by actively working on building partnerships and collaborations to expand its own charging infrastructure network By establishing strategic alliances, Rivian can attract more EV consumers by offering a reliable and convenient charging experience This proactive approach will not only address the current concern but also position Rivian as a leader in supporting the growth of the EV market c Innovation and technological advancements: Rivian has already demonstrated its capacity for innovation through its electric vehicle lineup, and to maintain a competitive edge, the company can further invest in research and development (R&D) initiatives and the creation of new technologies By allocating resources to R&D, Rivian can continue to push boundaries and introduce cutting-edge advancements in the electric vehicle industry 5.2.4 Threats Rivian Automotive, Inc (RIVN) faces several threats that could hinder the company's progress and profitability These threats include: a Competition in the electric vehicle market: Rivian operates in a highly competitive landscape, facing competition from both established automakers and emerging players in the electric vehicle market Established companies such as Tesla, Ford, and General Motors are significant competitors, leveraging their brand recognition, manufacturing capabilities, and established customer base In addition to established automakers, new entrants like Lucid Motors, Fisker Inc, and Faraday Future pose a competitive challenge These companies bring fresh ideas, innovative designs, and technology advancements to the market, aiming to capture a share of the growing demand for electric vehicles 33 b Technological advancements: The electric vehicle market is rapidly evolving, and advancements in battery technology, charging infrastructure, and autonomous driving capabilities could impact the competitiveness of Rivian's products c Financial instability: As a relatively young company, Rivian may encounter financial challenges, especially in the current economic climate Economic uncertainties can impact its ability to allocate sufficient funds for research and development (R&D) initiatives, expand production capacity, and pursue acquisitions of new technologies or companies Summary Rivian Automotive, Inc (RIVN) has made a significant impact on the automotive sector, impressing the industry with their commitment to manufacturing environmentallyfriendly electric vehicles that deliver exceptional performance This has propelled them to a prominent position in the market Like any other company, Rivian possesses distinct advantages, drawbacks, potential avenues for growth, and challenges This SWOT analysis will examine these aspects, providing insights into the current position of the company and its future prospects 34 VI CONCLUSION Tesla and Rivian have their strengths and weaknesses Tesla has a stronger market dominance, a well-established brand, and a wider range of products Rivian, on the other hand, has a strong focus on innovation and sustainability, along with significant investments and positive public perception In terms of opportunities, Tesla has a wider scope for introducing products to new markets, while Rivian can tap into the increasing demand for electric vehicles and target the adventure travel niche Both companies have opportunities to expand their charging infrastructure and continue technological advancements As for threats, Tesla faces intense competition from established automakers, while Rivian faces challenges in terms of high production costs and limited capacity Considering these factors, Tesla currently has a stronger overall position with its market dominance, brand recognition, and broader product lineup However, Rivian shows promise with its innovative technology, sustainability focus, and positive public perception The ultimate determination of which company is better would depend on specific metrics and objectives, as well as the evolving dynamics of the electric vehicle market 35 VII REFERENCES Adamkasi 2020 "Porter's Five Forces of Tesla" Porter Analysis Retrieved from: https://www.porteranalysis.com/porters-five-forces-of-tesla/ (January 21, 2022) Wall Street Journal (2023) Tesla Inc Retrieved from: https://www.wsj.com/marketdata/quotes/TSLA/financials/annual/income-statement RIVN | Rivian Automotive Inc Cl A Annual Income Statement - WSJ (n.d.) Retrieved from: https://www.wsj.com/market-data/quotes/RIVN/financials/annual/incomestatement T (n.d.) What are the Strengths, Weaknesses, Opportunities and Threats of Rivian Automotive, Inc (RIVN) SWOT Analysis Retrieved from: https://dcf.fm/blogs/blog/rivn-swot-analysis Rivian OEM Profile & Forecast,5: Rivian’s Impact on the Automotive Industry (2020, January 22) Retrieved from: https://markets.businessinsider.com/news/stocks/rivian-oem-profile-forecast-20192025-rivian-s-impact-on-the-automotive-industry-1028835211 36