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Reactions are still pouring in on the implications of Tesla (TSLA) opening up the Supercharger network to General Motors (GM) and Ford (F).
Wells Fargo analyst Colin Langan said the deal will enable Tesla (TSLA) to better utilize its charging network with about 4M GM and Ford electric vehicles forecast to be on the road by 2027, but warned the economic benefit may not be as great as some investors anticipate. Langan and team estimate that the annual charging revenue opportunity is only about $150 per car. “If 70% of charging is within the TSLA network, this would be ~$400M/year vs. TSLA 2022 sales of $81B. On the other hand, TSLA’s charging network is a competitive advantage today, but this gets diluted with the deals,” they reasoned.
Meanwhile, the Supercharger deal is observed to address one of the biggest pain points for potential EV customers of Ford (F) and General Motors (GM). It was noted that a recent JD Power study found that 20% of customers that went to a public charger could not charge, largely due to broken or out-of-service chargers. While the Detroit automakers companies are now relying on a competitor for an important service, the upside from providing a better customer experience could make it a net win
JPMorgan’s breakdown of the Tesla (TSLA) Supercharger developments included the view that the share price reactions for ChargePoint Holdings (NYSE:CHPT) and EVgo (EVGO) were overblown.
The firm continues to think that ChargePoint (CHPT) as a full-fledged charging hardware and software provider is well positioned to benefit across multiple verticals (work, multifamily, fleet) where Tesla (TSLA) is not a direct competitor. Analyst Bill Peterson said it is less clear for EVgo due to the long-term direction of GM. However, EVgo (EVGO) is noted to have significant partnerships across the electric vehicle OEM landscape, including with Toyota (TM) and Subaru (OTCPK:FUJHY).
“We would think GM and Flying J will continue investing in networks, which helps EVgo in terms of scale. Moreover, EVgo continues to have solid partnerships with autonomous and ride-sharing fleets and site locations are often not near Tesla’s networks.”
In premarket trading on Monday, ChargePoint Holdings (CHPT) was up 0.59% and EVgo (EVGO) fell 2.08%. Tesla (TSLA) showed a 1.25% gain as it looked to extend its 11-session winning streak. General Motors (GM) was flat and Ford (F) gained 0.38%.
