What’s Next For Tesla Superchargers After Elon Musk Laid Off The Entire Team

Tesla's global Supercharging network is the largest fast

charging network in North America, and it's often cited

as the EV makers biggest competitive advantage.

Tesla's Supercharger network, in part because they could

design all the parts of it, is the gold standard in

reliability and availability, and in seamlessness for EV

charging.

In the fast charging market, it's just Tesla leading the

way by almost a 60% market share.

But at the end of April, Elon Musk let go of Tesla's entire

supercharging team, laying off about 500 people,

including top executives.

Now its future is in question.

This decision has rocked the foundation of what everybody

believes about EV charging.

It's baffling.

Because they they do have such a lead and such a head start

and such a easy way to deploy, and the satisfaction

behind the user experience to have the rug pulled out from

under this, it is really confusing.

I would describe the Supercharger network as one of

the crown jewels of Tesla, and instead of doing victory

laps and building the Supercharger network and

reaping the benefits of this, this asset, suddenly there's

this pause.

The layoffs were part of a broader restructuring

happening at Tesla, as the company reckons with slumping

sales and increased competition.

Tesla's stock is down 32% for the year so far.

But cutting the Supercharging team was especially surprising

to many. The supercharging network was critical in

driving the adoption of EVs.

Tesla's now former senior director of EV charging,

Rebecca Tinucci, spoke about the success of the network at

last year's Investor Day.

At Tesla charging we have understood since day one that

a great charging experience is the linchpin to electric

vehicle adoption. We've spent ten years building charging

infrastructure when basically no one else in the industry

would do it. Those ten years have afforded us the

opportunity to get pretty good at charging.

When we're talking about electric cars, what we're

asking the public to buy into isn't really a new car.

It is a new fuel source.

Tesla was the gold standard in making that simple, and

they still are, arguably.

And so to see that their ecosystem is being somewhat

dismantled, it begs to question what is the next step

for Tesla as a company?

In the U.S., Tesla's market share and growth are greater

than all other networks combined, accounting for 58%

of all DC fast chargers deployed last year.

They also just recently announced that they're opening

up their charging network to other vehicle manufacturers.

Ford owners will be granted access to thousands of Tesla

Superchargers across the United States and Canada.

General Motors EVs will have access to about 12,000 Tesla

Superchargers. Yet another automaker saying, you know

what? Let's just go with Tesla.

Tesla's charging port, the North American Charging

Standard, or NACS, is now even becoming the standard in

North America on all EVs so that Ford, GM, and others can

more easily integrate into the super charging network.

The whole intent of the industry switching to this

connector type was for the growth and opportunity of what

it would mean for standardization around their

plug. That raises a lot of questions for consumer

confidence as well as industry confidence.

Analysts believe Tesla's charging business was set to

become a major profit driver for the company.

It is estimated that global public charging revenue will

rise to $127 billion by 2030, with Tesla thought to own $7.4

billion of that, Elon Musk said Tesla still plans to grow

the supercharger network just at a slower pace.

You can't have a Tesla the auto brand without Tesla the

Supercharger network permanently stopping the

growth of the Supercharger network is suicide for the car

business. They go hand in hand, in my opinion.

Tesla launched the Supercharging tetwork on

September 24th, 2012, with six sites in California.

Coinciding with the Model S entering production.

The network was free to use as an incentive for early

adopters.

You buy a car, you get our charging, you have a full

package. It's basically an Apple ecosystem effect.

Everything works together.

It's very nicely integrated.

By mid 2013, Tesla started building Superchargers in high

traffic corridors in Europe and Asia.

At the start of 2024, Tesla announced it had 6,000

charging stations with around 55,000 Superchargers.

Alongside its Superchargers, Tesla has widely deployed

around 40,000 destination chargers, lower power plugs

installed at hotels, apartments and other spaces

where people park for longer periods of time.

That type of infrastructure is not terribly expensive.

The majority of Tesla's charging network

infrastructure features its V3 Superchargers, which were

introduced in 2019 and provide up to 250kW.

It recently started rolling out its V4 Superchargers,

which are capable of delivering even more power in

Europe last year and has brought a handful online in

the U.S. this year.

They designed the cars and the software that they ran on, but

it also designed the Superchargers and the software

that ran them. And those two sets of software talked very

closely to each other.

This vertical integration has allowed Tesla to create a

seamless end to end user experience when owners charge

their cars.

I solely rely on Tesla Supercharging stations, and I

have used multiple third party companies such as

Electrify America, EVgo, ChargePoint, and they just do

not compare to Tesla's Supercharger network.

I feel sorry for people that don't drive a Tesla that have

an electric car, because Tesla does maintain their

facilities beautifully.

There's nothing else like it, right here in Santa Monica,

we've got a restroom and a place where you can get food.

They attracted customers with these sexy looking cars, but

the repeat buyers and the cult like following, that's a

result of the Tesla experience.

And a lot of the Tesla experience has to do with with

the Supercharger network, just the ubiquity of it and

the reliability of it.

For other charging providers, emulating this experience is

difficult, since they're having to design for multiple

car models with varying software and charging

protocols.

With Electrify America and with all the other networks,

to a greater or lesser extent, there is a certain

amount of discontent among EV drivers about reliability.

So there's a lot more software now that's being

added into diagnosed problems to let them know what's going

on.

With Tesla it'll tell you how many stalls there are, how

many are in use.

Whereas I've used Electrify America, I'll open up the app

and it says that it is available and I'll pull up and

someone's in there. The stall may actually be out of

service, not even functional.

Tesla also built in other benefits to its system, such

as battery preconditioning and congestion awareness.

Other electric vehicle manufacturers, well some of

them, have vehicle side data.

Other infrastructure providers have site data, but

at Tesla we have both.

And perhaps most important - scale.

Other charging networks, they would have a maximum of four

charging ports at a site.

Tesla, it's between 8 to 10 ports per site on average.

Musk said that expansion of existing locations will remain

a priority. Tesla installed around 12,000 chargers a year

for the last few years globally.

When it comes to figuring out where to put the

infrastructure, Tesla does it better than anybody else.

They know everything about their customers.

They know everything about their chargers.

That gives them laser like focus on figuring out where

does it make sense for them to put their infrastructure.

So why did Tesla gut the Supercharger team then?

Perhaps it just didn't make sense financially for the

company.

In the early days, Tesla's Supercharging network was

predicted to lose money.

The construction and maintenance of EV charging

stations can be expensive, with prices varying widely

depending on the type of charging and power

infrastructure being built.

Installing EV charging is really expensive today.

We're not at mass market yet in terms of costs.

We are still seeing around 250,000 being the benchmark

for high power.

Charging, actually the main cost, believe it or not, is

not the charger itself. The main cost is what you need to

bring from the grid.

You have to do site prep, you have to trench power lines and

more importantly, the electric utility either has to

have high voltage power near the site or they have to bring

it in.

However, Tesla did say that it has managed to cut its costs

considerably.

We have the industry's lowest deployment costs.

Our costs are often 20%, if not 70% lower than

alternatives.

While it hasn't publicly disclosed supercharger

construction costs, government funding through the

National Electric Vehicle Infrastructure Formula Program

has provided a window onto Tesla's costs compared to its

competitors.

Tesla is really bidding 50% lower than any other network

out there for NEVI funding, which is why they've got the

most amount of funding to date.

For Supercharging, Tesla uses dynamic pricing that factors

in the electricity costs, charging power output, and

peak or off peak hours.

Musk has indicated Tesla aims for about 30% gross margin, or

around 10% profitability on its superchargers.

Tesla doesn't break out revenue from its charging

business, bundling it in its Services and other business.

But it has called it out in recent earnings statements,

saying "pay per use supercharging remains

profitable" and that it was part of 2023 biggest profit

generators, helping contribute to the nearly $500

million in gross profit for the segment.

In the U.S., charging infrastructure is getting a

boost from federal funding, which Tesla has been

aggressively pursuing.

They've got around $12 million in NEVI funding so far for

around 30 sites in comparison to a lot of the others.

So they've got the most amount of funding.

The Biden administration's Charging and Fueling

Infrastructure and the National Electric Vehicle

Infrastructure Formula programs are part of President

Biden's goal of growing the national charging network to

500,000 stations by 2030.

So far, states have allocated $1.5 billion in funding for

2022 and 2023 to support the construction of chargers, with

an additional $885 million for 2024.

Government funding in the infrastructure bill has

spurred a lot of work around creating electric vehicle

charging infrastructure, but given how long ago it was

announced, it has taken a while simply due to process.

In addition to supporting the development of charging

infrastructure, the programs also hope to address some of

the pain points common.

Today.

We're seeing standardization for uptime requirements

requiring 97% uptime on all federally funded chargers,

also requiring payment systems to be installed on

these chargers directly. Trying to push towards having

a more seamless charging experience for all EV drivers

in the U.S. Today.

Tesla has said "it's always been our ambition to open the

Supercharger network to all EVs and by doing so, encourage

more drivers to rapidly transition to an emission free

future." It started with making moves on that promise

in 2021, with a pilot program in the Netherlands that

allowed non-Tesla EV owners to charge at ten Supercharger

sites. After a successful run, it began expanding access

throughout Europe in 2022.

In the states, as President Biden announced new standards

for EV charging funded by the Bipartisan Infrastructure Law,

it was revealed that Tesla would be opening part of its

network. The move would grant Tesla access to federal funds

as part of the effort to build out a nationwide

charging network.

Tesla if they go after NEVI funding, they would have to

allow more vehicles to charge at these chargers, and that's

the biggest reason why I think Tesla would open up the

network to other automakers.

In 2023, Ford announced a deal with Tesla to leverage its

superchargers for Ford EV customers.

Owners would need a Tesla developed adapter to give its

CCS ports compatibility with Tesla chargers.

Ford and Tesla stunned the industry by saying, we have

arranged for Fords to have access to Tesla's Supercharger

network nationwide over time.

It's been a pretty bulletproof rollout.

Ford owners seem to be uniformly happy.

Shortly after its announcement, GM also said it

would work with Tesla. CEO Mary Barra said it will save

the company $400 million of a planned investment in building

out EV charging in the U.S.

and Canada.

Every other maker has pretty much said yes.

We will give our folks access to the Tesla network.

As other EV owners have started using the supercharger

network, it has presented some challenges.

Regrettably, they have to park crosswise in two spaces

because Tesla designed all of the superchargers that are out

there now, with cables that are just long enough to reach

the left rear corner of a Tesla, the new Tesla

Superchargers that are rolling out will have longer

cables.

There have been complaints about lines at Tesla stations,

with access being granted to more EVs, congestion at

charging sites is a growing concern.

It's going to be interesting to see how Tesla owners handle

a fairly large influx, and Tesla's managing it.

They're rolling out each car company at a time.

In the U.S., every automaker besides Tesla has been using

the CCS connector, meaning anyone using Tesla's network

will need an adapter, but that is quickly changing.

SAE International, an association that sets

technical standards for aircraft and vehicles, worked

with Tesla to standardize NACS, now named the J3400

standard. Ford was the first to adopt Tesla's connector,

with GM signing on in June 2023.

We plan to adopt the North American charging standard,

and we're working really hard that our first vehicle will

come in 2025.

Almost every other automaker has agreed to adopt NACS in

its vehicles either this year or in 2025.

The convergence of everybody on a single standard in the

U.S. is a hugely positive thing, that will accelerate

adoption of electric vehicles.

When you combine the the NACS plug with opening up their

chargers to everybody else, I think that's just a it's a

massive win for Tesla for sure.

But I think for the consumer and for the marketplace, I

think it's a massive win for everybody else as well.

In October 2023, BP announced it had ordered $100 million of

Tesla's ultra fast chargers.

It's the first time Tesla's chargers will be deployed by

an independent EV charging network and will be installed

at key BP, Amoco, AM PM, Thorntons, TravelCenters of

America and other charging locations.

Between widespread support across the U.S.

Automotive industry and a surge in government funds to

build new sites, it seemed Tesla's charging business was

on the verge of going stratospheric, but then

everything came crashing down.

Elon Musk has surprised markets and the auto industry

by scrapping the unit responsible for Tesla's

charging network.

In an email announcing the layoffs, elon Musk said we

will continue to build out some new Supercharger

locations where critical and finish those currently under

construction.

I wonder how that's going to impact my decision for having

purchased a Tesla, because that's one of the selling

points, right? Is that, you know you have this really

cool, extensive network where you can charge and it's

seamless.

THe Supercharging network is like the lifeline for the

Tesla cars. You got to keep that team.

The ideal is that there will be more charging stations.

I've been on the fence about whether or not I'll get

another Tesla, but that honestly pushes me over the

edge.

This is taking the place of gas stations and you need a

whole lot more. You can make so many billions of dollars.

This is not no time to lay them off.

Stop playing around. I think it's time for Elon to take a

break.

For employees and contractors working with Tesla, the news

was sudden and unexpected.

My business partner, he was driving to a Tesla

Supercharger site that we're doing right now, and he got a

call from our construction lead at Tesla telling him to

turn around, his entire division had been laid off,

and Mark should go home and go pencil down on the project

until we find out what's going on.

Andres Pinter owns a residential and commercial

charging installation business, and has worked with

Tesla on several installation projects in Texas.

We contacted everybody that we know at Tesla.

Every single one of those emails bounced.

We have a number of open purchase orders of jobs we're

working on for Tesla.

I think they'll complete those jobs, and quite frankly,

it's a liability for the company to have open permits,

open construction sites.

It's just it's sloppy.

They're not going to do that.

Without an internal team, some predict Tesla will outsource

development of new sites.

We would love to take on the responsibility of building

that supercharger network for Tesla.

I think there's a lot of contractors that probably have

ambition and ability to do it.

Tesla reportedly left its Supercharger maintenance team

intact and says it will support existing sites.

Maintaining the Supercharger network looks easy, but

there's a lot of people involved and a lot of

resources. Tesla's got it down to a science.

I think that the suppliers they work with on the

maintenance, and particularly the software that they employ,

is key to maximizing the uptime.

If Tesla's going to maintain the existing supercharger

network with a team of whatever size that might be,

that will give drivers, I think, confidence, but we're

going to be selling millions of more EVs down the road.

So that then asks, how well will this existing network

stand up to that additional use by more brands from other

automakers?

I do a lot of driving, so I have been to a lot of

supercharger stations. There's a lot of chargers that

don't work, so they got to get their customer service

down. The response is terrible.

It's just like a run around in circles.

I just stopped trying to contact them.

It's just a waste of time.

Now we're possibly, potentially adding charging

being a problem and congestion and people having

to wait. I don't know man.

Like me personally. I'd just go get a Mercedes.

It's already strained in certain urban areas such as

New York, Los Angeles, San Francisco, to now know that

that expansion is going to be really halted.

It then leans on third party charging networks.

It's too early to tell what the full impact of Tesla's

decision will be, but some believe it will place more

responsibility on an industry not ready to take on the

mantle of the Supercharger network.

Without having the brain trust at Tesla that's been rolling

that out and making it possible. We are going to then

rely on industry to pick up the slack.

One of the biggest hurdles the industry faces is

infrastructure policy.

Tesla's policy team worked hand in hand with its charging

team in the deployment of the supercharging network.

The policy team was able to navigate a lot of what are

typical red tape problems as it relates to infrastructure

rollout, that third party networks still battle on a

regular basis. Tesla's team had become very, very savvy in

how to navigate that on a federal and state level.

But to blow up their own closed ecosystem that was

working so elegantly is baffling.

Tesla does have growing competition in the charging

space. While it enjoyed dominance in its home market,

it is a smaller player in Europe and China.

And there are companies with the ambition to catch up and

exceed the Tesla Supercharger network.

There's Ionna, the joint venture between GM, Hyundai

and a number of other auto OEMs. Mercedes is a deep

pocketed competitor that's building their own

supercharger network. Rivian's building their own

supercharger network.

Last summer, several legacy automakers joined together to

form a new joint venture to create a network of 30,000

plus chargers in North America, with the first

stations expected to open this summer.

In 2019, shell acquired LA based charging company

Greenlots and has started installing chargers at its gas

stations as part of the Shell Recharge network.

In the UK, it is converting a gas station to a full EV

charging one.

Oil and gas and retail is the next biggest growth sector

that we're seeing today with shell, BP, Circle-k, 7-Eleven

all trying to enter this space not just to make money

off EV charging, but really trying to make the money off

the dwell times.

An EV driver is likely going to dwell there for longer than

they will at a gas station.

The smart charging providers will see that there is going

to be a way to squeeze a lot more money out of the wallet

of their travelers.

With more infrastructure being built out across the board,

experts predict it will improve the charging

experience for everyone.

The software is going to be standardized, the

communications is going to be standardized, the payment

processing is going to be standardized.

The plugs are becoming standardized.

There definitely needs to be some sort of consolidation.

And only time will tell whether Musk's radical change

in Supercharging strategy is the right one for Tesla.

In my opinion. Mr.

Musk is playing three dimensional chess, and he just

made a move that none of us comprehend yet.

Some will interpret it as a brilliant move, some will

interpret it as a bonehead move and only time will tell.

We have really relied on Tesla's leadership here in

North America, and I think to all of a sudden have that

seemingly halted.

That brings into question where do we go from here and

who will step up the way that Tesla has?