Tesla and Rivian Shift Focus to AI
Tesla, now valued at over $1 trillion, is being perceived more as an artificial intelligence (AI) stock rather than merely an electric vehicle manufacturer. This shift is evidenced by its share price trading at over 13 times sales. In contrast, Rivian Automotive, with a market cap under $20 billion, trades at approximately 3 times sales.
Earlier this year, Tesla invested $2 billion in Elon Musk’s AI start-up, xAI. The company plans to allocate a significant portion of its $20 billion capital expenditure budget to AI by 2026. Meanwhile, Rivian has announced plans to accelerate AI technology adoption in its factories and focus on full self-driving capabilities. Its new R2 SUV, priced under $50,000, slated for employee deliveries this month, aims to establish a stronger foothold in the robotaxi market.
