Tesla Can Expect $3 Billion Tailwind From Charging Deals With Other EV Brands: Piper Sandler

Tesla can expect a considerable $3 billion tailwind from its new deals with Ford and General Motors, which will allow the legacy automakers’ EVs to plug into and utilize Tesla’s charging infrastructure. 

That estimate was provided by Piper Sandler & Co. and reported by Bloomberg on Friday morning, following the news on Thursday that GM would be joining Ford, who already had a deal in place with Tesla, in sharing the EV leader’s network.

The deals make Tesla’s charging infrastructure the standard for electric vehicles in the U.S., and will put pressure on competitors to drop other standards in favor of adopting one format. 

Piper Sandler analyst Alex Potter wrote on Friday morning: “Other brands will be forced to join this consortium, effectively establishing Tesla’s ‘North American Charging Standard’ as the preferred approach for EV charging — at least in the United States.”

According to Bloomberg, he predicted “$3 billion in charging revenue from non-Tesla owners alone by 2030 and $5.4 billion by 2032”. 

Recall yesterday we detailed GM’s decision to use Tesla’s infrastructure. As we said then, the decision follows a similar move by Ford, and will allow GM vehicles to access 12,000 of Tesla’s chargers using a special adapter and the Detroit automaker’s EV charging app, beginning in 2024.

The partnership was heralded by CNBC as a ‘major win’ for Tesla and its charging technology – and it’s expected to add pressure on other automakers (and the US government) to adopt Tesla’s technology.

The deal is expected to be announced by GM CEO Mary Barra and Tesla CEO Elon Musk during a live audio discussion Thursday on Twitter Spaces. GM is ramping up production of its fully electric vehicles in pursuit of Tesla-level sales volumes in the segment.

It also marks a stark reversal in strategy for GM. Weeks ago, when Ford announced its own partnership with Tesla, GM was working with engineering organization SAE International to develop and refine an open connector standard for CCS. -CNBC

“This collaboration is a key part of our strategy and an important next step in quickly expanding access to fast chargers for our customers,” Barra said in a statement. “Not only will it help make the transition to electric vehicles more seamless for our customers, but it could help move the industry toward a single North American charging standard.”

The deal between GM and Tesla will likely benefit both companies – more than doubling access to fast charging stations of which Tesla says there are roughly 4,947 worldwide. The company has not disclosed how many are located in the United States.