Presumably you are in a location where it does not get too cold outside? 

The HPWHs I looked at had vent kits available for intake and exhaust. IIRC that one used 8" vent pipe, but yours might vary. My area is too cold to use outside air for intake, at least on the HPWHs I looked at. I think they require 37°F minimum for intake air temperature.

*I'd be replacing that flex duct for the dryer with rigid, too.*