Tesla and Rivian: The Dynamic Landscape of Electric Trucks
Tesla (NASDAQ: TSLA) has fundamentally shaped the electric vehicle (EV) market, compelling traditional automakers to recognize the technology as a substantial business threat. All EV companies are benchmarked against Tesla, which has transitioned from a startup to a consistently profitable and sizable player in the automotive industry. This sets the stage for an interesting comparison with Rivian (NASDAQ: RIVN), an emerging EV truck manufacturer.
Tesla’s Operations
Tesla produces a variety of electric vehicles, ranging from sedans to trucks. In addition, it engages in high-tech activities such as robotics and clean energy solutions. Nevertheless, its automotive sector remains significant. In 2024, Tesla sold approximately 1.8 million EVs across its various vehicle platforms.
Currently, Tesla categorizes its Model 3 and Model Y together, which account for around 95% of its overall vehicle sales. The remaining 5% falls under the “other” category, which includes the Cybertruck that started deliveries in late 2023. Despite high expectations, the total sales for “other” vehicles, even if entirely from Cybertruck, peaked at around 85,000 units. Notably, sales in this category plummeted nearly 50% from 23,640 units in Q4 2024 to 12,881 in Q1 2025, indicating potential troubles for Tesla’s truck business. This drop may coincide with CEO Elon Musk’s interactions with the Trump administration.
Rivian’s Focus
Rivian specializes exclusively in electric trucks, targeting both the consumer and commercial markets. The company dedicated 2023 to boosting production levels, aiming for about 50,000 vehicles annually. By 2024, it shifted its focus to achieving profitability, with a modest gross profit reported in the fourth quarter. Overall, Rivian is making significant progress as a business.
Interestingly, Rivian’s production figures align closely with Tesla’s “other” category. In the first quarter of 2025, Rivian sold approximately 8,000 trucks—about 60% of Tesla’s “other” vehicle sales. If you analyze the fourth quarter of 2024, before external factors may have impacted Tesla’s sales, Rivian’s sales in Q1 2025 would have represented around one-third of Tesla’s “other” category.
Market Dynamics and Differentiation
Rivian adopts a distinct approach compared to Tesla. While Tesla’s Cybertruck has a controversial design, Rivian’s vehicles are more traditional in appearance, likely appealing to a broader audience. Additionally, Rivian’s production of commercial trucks opens a substantial potential market. Thus, it may be easy for investors to overlook Rivian in the EV truck landscape.
However, considering Tesla’s commanding position in the overall EV sector, this might be a miscalculation. Rivian has made impressive strides in a short time, but whether its selected niche can sustain long-term profitability remains uncertain. The comparison to Tesla suggests that Rivian could face a challenging path to consistent profitability.
Investment Considerations for Rivian Automotive
Before investing in Rivian Automotive, consider the following:
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Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
