GM and Ford Have Bent the Knee to Tesla Supercharging

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GM, like Ford, will begin installing a charging port used by Tesla, known as NACS, instead of the current industry-standard CCS, in its EVs starting in 2025.

Under the deal, GM vehicles will be able to access 12,000 of Tesla’s fast chargers using an adapter and the Detroit automaker’s EV charging app, starting next year.

GM expects to save up to $400 million of a previously announced $750 million investment to build out EV charging.

1.5 billion electric cars and 40 million electric Semi trucks will need 4000 kWh per car per year and 100,000 kWh per truck per year of electricity. This totals up to about 10 TWh/year. The cars and robotaxi will need to be charged for charging when they away from residential charging. There could be about 5 TWh/year for the future electric charging network that replaces gas stations. If this is $0.10 per kWh in profit for electricity sales then this would be $500 billion per year in global charging profit and $1-1.5 trillion in revenue if the electricity is sold at $0.20 or $0.30 per kWh.

If the average american car is driven 15000 miles per year, but 20% of miles are for non-home charging this is 3000 miles per year charged at Tesla. If each GM EV gets 4 miles per kWh and Tesla makes $0.20 per kWh of profit, then Tesla will make $150 per year per GM EV. There are about 300,000 GM EVs in the US today. This development shows that other carmakers like Hyundai and Volkswagen will also adopt Tesla charging as standard.

The GM deal will be about $45 million per year initially for charging.

The bigger future possibility is if other carmakers turn to Tesla for a single software solution, Autopilot and Full Self-driving and Tesla batteries or the skateboard.

Currently, Tesla is at 4.2 electric cars on the road and there are about 30 million EVs on the roads. Ford adds another 300k electric cars to Tesla’s charging network. By the end of this year, Tesla will have about 6 million EVs in its charging network and 12-15 million by the end of 2024 (this depends upon how many EVs Tesla makes and how many other car companies join the Tesla charging network.

Building out the Semi trucks, Cybertrucks at scale will massively increase the demand and usage of megacharging stations. By the end of 2026, there should be about 100 million EVs on the roads and about 20-25 million Tesla’s. There should be about 150,000-300,000 Tesla Semis on the roads and 500,000 to 700,000 Cybertrucks. There should be about 50,000 Megapacks at Megacharging stations. Tesla would be charging ten to 15 times more miles than today, if Tesla gets most of the other EVs charging at Tesla charging stations.

If Tesla builds at 400 Posts per week, then Tesla can add 20,000 Supercharging station posts. Globally, Tesla can add a lot more charging in Asia and Europe.

Each Megapack provides 3.9 MWh of storage and Tesla sells them for $2.6 million each. However, the Megapacks only cost Tesla about $1.3 million each. Tesla will build out Megacharging stations with many Megapacks and lots of solar for generation. The electric grid cannot handle all of the charging for all of the electric semi truck, cybertrucks and all EVs. The world uses about 25% of oil for cars and trucks. If we convert those over time then we will need about 20-30% more electricity as we convert for gasoline and diesel to mostly solar and batteries.

The Megapacks will be charging trucks at a rate of 1-3 Megawatts per hour. The megapacks will be charged with solar, wind or grid energy and then will be discharged by charging electric trucks and cars. If there was two megawatt of solar power per megapack at each location, then each Megapack on a fully sunny day could get fully charged once per day off of local solar power and possibly once more if there was available grid power overnight. If we assume one full charge and discharge every day, and $0.30 per kWH as the price. This would be $1170 per day per Megapack. The 2 megawatts of solar power would be extra capital cost. The cost of solar farms is about 1 million per megawatt. This would be $4 million for Tesla per complete Megapack charging. There are 30-50% tax incentives. This is for each megapack 2 MW of solar and charging station and land improvement. This would be about $427000 per year.

If there was no solar power onsite, and there was wholesale pricing of $0.10 per kWh, then the $2 million for each Megapack of a Megacharger station would have to pay $143000 per year for 3900 kWh per day and make $284000 if the charging electricity was sold for $0.30 per kWh.

By 2025, Tesla will have the Lathrop and Shanghai Megapack factories fully ramped and they will be making 20,000 Megapacks per year. Tesla will build about 1 to 2 Lathrop sized Megapack factories each year from 2025 onwards. If Tesla were using 10,000 Megapacks each year for a global truck charging network then they would be growing megacharging and supercharging by about $4 billion per year. If Tesla is selling 50,000 Semi trucks per year as is the goal for 2024, then 10,000 Megapacks per year will be needed for charging those trucks. If Tesla scales beyond 50,000 semi trucks per year to 500,000 Semi trucks by 2028-2029, then the Megapack demand will be about 100,000 Megapacks per year.

This would use a lot of capex. This would be about $200-400 billion per year. The charging would be a lot of recurring annual revenue. 250,000 Megapacks would be a TWh/year of charging.

Unlike Megapack sales to a utility, Tesla would be getting tax credits in the year that the Megacharging station is completed and then it will take 5-10 years for the return on investment just from charging revenue. Tesla would also make money on food and service sales just like gas stations and truck stops today.

China is expected to add 95 to 120 gigawatts (GW) of solar power in 2023. China added 87 GW of new solar power into operation in 2022 making the total installed capacity to 392.6 GW at the end of 2022. China probably already added 30-40 GW in 2023 to bring its total installed solar to 420 GW and 520 GW at the end of 2023. The world installed 268 GW of new solar capacity in 2022, with annual installations expected to hit 315-350 GW in 2023.

Global installed solar generation capacity reached about 1.1 TW in 2022. Total global wind power capacity is up to 837 GW at the end of 2022 with 78 GW added in 2022. This is one fifteenth of Tesla projection of a final total of 30 TW of solar and wind. There should be about 6-8 TW of solar and wind by 2030 and 16-18 TW of solar and wind by 2040.

6 thoughts on “GM and Ford Have Bent the Knee to Tesla Supercharging”

  2. Lol at other auto makers taking on FSD.

    You smoke some strong stuff there Brian, can I have a taste of it?

    As to the chargers a short term shift to Tesla proprietary standards while they build out their own infrastructure is to be expected.

    You see endless profits because you have shareholder tunnel vision goggles on.

    I see a short term stepping stone to boost their market share before they double back to CCS – there are plenty of places where Tesla has little to zero presence as yet (chargers or vehicles) which gives GM and Ford more than enough time to carve out their own niches prior to expanding into current Tesla held territory.

    If you seriously think this is some eternal capitulation from GM and Ford you clearly don’t have a mind for business at all.

  3. I think that Musk understood, that “skeleton” needs to be build, chargers so people will start adopting EVs. Tesla got there first. As the petrol stations will be replaced, profits from chargers will go up and Tesla has a lot of them.

    Petrol pumps and whole petrol network with is terrible inefficient. It is time we go away from that.

    • Tesla “getting there first” does not prevent others from getting there after which is what Brian seems to be apt to ignore at any cost – very rah rah Tesla pom pom waiving behavior as per usual on this website.

      Oh for the days when it was actually a science news website and not his pump up the Tesla stock puff piece regurgitation hour.

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