Buy Hold Rant
Why full stack EV companies Tesla, Rivian are poised to outcompete legacy automakers
10/16/2025, 7:00:55 PM
Economic Summary
- EV adoption is currently around 10% of the market but is expected to rise toward ~95% over the long term, driven by the need to move off fossil fuels; timing is uncertain but the transition is viewed as inevitable.
- A structural industry shift favors vertically integrated, full-stack automakers (notably RIVN and TSLA) that combine hardware and software, creating advantages over traditional OEMs that rely on many suppliers.
- Legacy OEMs face a major consolidation/integration challenge for components and software; licensing deals (e.g., Rivian with VW) present a monetization path and faster adoption for platform providers.
Bullish
- Transition to EVs is inevitable; market share will grow well beyond the current ~10%.
- Full-stack vehicle makers (RIVN, TSLA) benefit from vertically integrated hardware and software.
- Rivian can license its platform to OEMs (example: VW), creating additional revenue streams.
Bearish
- EV adoption timing is highly uncertain and could take decades, delaying benefits for EV manufacturers.
- Legacy automakers face large integration challenges consolidating components and software.
- Intense competition from Chinese EV makers and incumbents could pressure margins and market share.
Bullish tickers
RIVNTSLAVWAGY
Bearish tickers
RIVNTSLAVWAGY
RIVN
Bullish
Full-stack EV approach and platform licensing (example with VW) position Rivian to capture market share.
Bearish
EV adoption timing uncertainty and intense competition could delay profitability and growth.
TSLA
Bullish
Leading US full-stack EV company benefiting from vertical integration of hardware and software.
Bearish
Competition from other full-stack EV makers and global rivals may pressure Tesla's dominance.
VWAGY
Bullish
OEMs like Volkswagen can accelerate EV transition through platform licensing and partnerships with companies like Rivian.
Bearish
As a legacy OEM, Volkswagen faces big integration challenges across components and software.