Tesla’s proprietary charging network helped power its rise as the dominant US electric-car maker. Now it is opening that network to rival marques — a decision that will shake up a nascent roadside charging industry.
The Supercharger network’s thousands of locations were designed to repower only Tesla vehicles — a “walled garden”, in Elon Musk’s words. But last week the chief executive said he will allow Ford cars to plug in at 12,000 sites starting next spring. Tesla earlier announced plans to invite other EV brands to use at least 7,500 charging locations by the end of 2024.
Opening Tesla’s garden will alter the ecosystem that has sprung up outside its gates. Specialist charging companies such as Chargepoint Holdings, EVgo Services and Electrify America have been competing to serve cars made by a variety of manufacturers.
“Everyone will get affected in some shape or form if Tesla’s charging network continues to grow and reach more types of vehicles,” said Nick Nigro, founder of the consultancy Atlas Public Policy, a research group. “[Tesla is] seeing the opportunity of where the market is going, and they know they have a good charging service . . . They think they’re ready to do that for all vehicles now.”
The US has roughly 139,000 ports, or individual charging places, with just under 32,000 of them offering “fast” charging that can replenish a battery in about 30 minutes, according to Atlas. Tesla operates more than 19,000 fast chargers. In an effort to hasten adoption of electric vehicles, President Joe Biden has said the US needs to establish 500,000 public chargers across the country by 2030.
Jonathan Levy, chief commercial officer at EVgo, sounded sanguine about Tesla’s move as the overall market expands. “Getting to EV ubiquity means having more fast charging, and so Tesla will have more, we will have more, our competitors will have more, and we’ll continue to grow the pie,” he said.
Brendan Jones, chief executive of Blink Charging, said Tesla’s move did not signal that fast charging was becoming a commodity service such as filling up at a petrol station. Slower public chargers, known as “Level 2”, have been growing more commodity-like over the past three years, he said.
Most vehicle charging is done overnight at home, where EV owners can benefit from cheaper electricity prices and charging that can take up to 12 hours is no drawback. But public charging stations, particularly fast ones, are essential to allay fears of being stranded with no place to charge, a barrier to EV sales.
Some charging companies including Chargepoint, EVgo and Volta Charging went public through deals with special purpose acquisition companies during the recent boom in such vehicles. Some groups sell electricity, while others sell equipment and software. Volta, which planned to generate money through advertising on charging posts, is now charging for electricity and was purchased by the oil major Shell in March.
The stock prices of many of the publicly traded charging companies have plummeted as interest rates rose and investors soured on unprofitable companies pouring capital into charging networks. Chargepoint has fallen 69 per cent since it debuted in February 2021, while EVgo has declined by 74 per cent.
“Wall Street hates the stocks,” said Craig Irwin, an analyst with Roth Capital Partners, because the rapid growth in EV adoption has meant the companies needed more capital than they expected. Yet “there’s nobody that I’m seeing that’s really stumbling right now. It’s hard to stumble when your industry is growing close to 100 per cent.”
One regular frustration of electric vehicle drivers is travelling to a public charging point only to find it unusable. In response, Ford in 2021 started a programme called “Charge Angels” where workers were sent to test charging points available to customers. Nigro at Atlas said its deal with Tesla is “arguably a shot across the bow to the existing charging providers to Ford vehicles”.
Other than Tesla, the charging experience is “lacklustre”, Nigro said. As EV adoption increases, charging companies will be tested to improve engineering and customer service, with deep-pocketed groups commanding an advantage.
“There are going to be some winners, and there are going to be some losers,” he said.
Investors have sunk $13bn into US EV charging infrastructure, according to Atlas. A bipartisan infrastructure bill that Biden signed in November 2021 allots $7.5bn to build out a network of chargers across the country.
The federal funding washing into the industry is “material”, Irwin said. But to be eligible, companies must adopt the dominant charging standard known as the combined charging system (CCS). Tesla, which has a different standard, must extend charging service to other car brands to qualify for the subsidies.
Hooking up different types of cars at Tesla Supercharger locations may present practical challenges. It is easier to provide a seamless charging experience for customers when, like Tesla, a company controls both the vehicle and the charging infrastructure. Levy of EVgo noted that one of the most common problems with public charging were communication timeouts between charger and vehicle, or between cloud and payment processing systems, “and Tesla has not had to deal with that yet”.
Even a charging site that is laid out to accommodate Tesla vehicles could have problems if the cables on the charger are not long enough to reach the connection site on the vehicle.
“Nissan Leaf’s in the front, [Hyundai Ioniq 5] is on the back right, . . . Volvo is the back left — the cable needs to be able to reach all those folks, as well as serve multiple voltages,” Levy said. “So there are a lot of questions.”
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