EkaLore has previously released our analysis and notes on the global Electric Vehicle marketplace. As an “Alien Invader,” Telsa Motors takes on traditional global vehicle manufacturers. In this release, we look at an additional element of the competition, Charging Networks, as new announcements are made in the USA.
Tesla Motors has built out the Supercharger network, that is, electric vehicle battery charging locations, as enablers for its rapidly increasing vehicle sales in the USA. Initially only open to Tesla vehicle owners, the Supercharger network attracted the interest of the number 2 and number 3 producers of EVs in the USA.
General Motors has joined Ford Motors in adopting the North American Charging Standard (NACS). NACS was developed, championed, and then released as a proposed industry standard in competition with the Combined Charging Standard (CCS). This coalescing around the NACS infrastructure (almost all of which is Tesla’s) by traditional USA manufacturers also contributes to their political clout to steer subsidies where wanted.
CCS was first promoted in the EU/UK marketspaces for EVs. Tesla did offer to combine their standard with the CCS standard, though it was turned down. In Europe (EU), Tesla has adopted the CCS charging plugs and infrastructure due to EU and national regulatory requirements. In the USA, electric vehicle charging competitors such as EVgo, ChargePoint, and Electrify America (initially funded by VW Group and Siemans), among others, have focused on the CCS standard with the tacit support of the USA Federal Government. Tesla has agreed with the USA Federal Government to adopt a limited number of CCS plugs across its widespread Supercharger network to enable competitive EVs to charge in its infrastructure.
Tesla Motors’ construction of the Supercharger network has seen marketing positions in support of vehicle sales (such as discounts or substantial free charging credits). Tesla also will see value from consumers interacting with the same direct-to-consumer interface for subscriptions and charging. Traditional manufacturers are still looking for the keys to direct-to-consumer selling in the USA marketplace. Constructing additional locations with Ford and GM as participating manufacturers will increase the value of Tesla’s in-house manufacturing and ability to tap subsidies in USA Federal legislation for EV charging infrastructure. GM and Ford can adopt a widespread network without the concerns of building out new infrastructure, as capital costs have still been rising.
The Supercharger network has set solid benchmarks for ease of use (app focused) and high availability (reliability). Competitive networks have struggled to gain an accepted user interface with a reputation for high availability. Increased infrastructure costs for ‘fast charge’ locations (requiring materially more electrical utility infrastructure) have also been a factor as the rapid adoption of EVs in the USA market progresses. Tesla holds the largest marketplace share of the EVs being purchased in the USA, with Ford and GM following. Ford and GM are planning major volumes for purchase by consumers in the next few years. In competition with active model offerings from Japanese, Korean, and German manufacturers, the build-out of CCS charging station networks will still cost many billions of US Dollars.
Tesla’s Supercharger network use of the Tesla App (and AppCommerce) also points to a split with traditional vehicle manufacturers. GM wants to exclude tech AppStores and provide a curated-garden of its own applications and cloud services. Ford has already decided to focus on cooperating with Google, Apple, and other AppStores on a global basis. It is likely that Tesla will make gains in this area by providing its Supercharger network at the best terms on its proprietary app. The streamlined user experience will be a continuing advertisement to EV owners. This was undoubtedly known to GM and Ford, though viewed as not the highest requirement in the EV owner's interactions.
The EV market is evolving quickly as traditional manufacturers must change their long standing practices to gain a profitable foothold in the market. Alien Invaders like Tesla have changed the rules, sucked a lot of profit out of the marketplace, and blindsided traditional competitors. If you’d like to read more stories about Alien invasions, you can find them at www.ekalore.com/alien-invaders
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