Wednesday, July 24, 2024

GM Adopts Tesla’s EV Charging System, Wall Street Cheers

June 8 (Reuters) – General Motors ( GM.N ) will join Ford ( FN ) in adopting Tesla’s ( TSLA.O ) North American charging plug standard and give GM electric-vehicle buyers access to the Tesla Supercharger network. Thursday.

GM’s move, which follows a similar decision by Ford to embrace Tesla’s charging plug standard, means that the three leading EV vendors in the North American market have now agreed on a standard for charging hardware. The deal was announced by GM CEO Mary Barra and Tesla chairman Elon Musk at a Twitter Spaces event.

Investors praised the deal, and the prospect of a charging hardware standard for the North American market. GM shares rose more than 4% after Bell and Tesla shares rose 4%.

A coalition of three leading rival US EV manufacturers has significant business and public policy implications.

The Biden administration adopted a competing “integrated charging system” (CCS) standard to allow companies to receive billions of dollars in federal grants for new charging stations along some 7,500 miles (12,070 km) of the nation’s busiest roads. . Alliance between Tesla, Ford and GM challenges White House direction

But Transportation Secretary Pete Buttigieg told CNBC in May after the Ford-Tesla deal that the industry would eventually converge on one system, but the adapters would allow cross-use.

Tesla, GM and Ford account for 70% of current US EV sales. Industry executives see the variety of EV charging connectors as a barrier to widespread consumer adoption of electric vehicles.

“I think this is going to be a fundamentally big thing for the advancement of electric vehicles,” Musk said during a Twitter Space conversation with Barra.

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“I think it all got a little better,” Barra said.

GM could save $400 million from the deal, Barra told CNBC in an interview Thursday.

‘Snowball Effect’

From a consumer standpoint, the deals with Detroit automakers appear to be a win for Tesla, which has invested heavily in installing its own unique fast-charging stations across North America, while most other automakers outsource charging to third parties.

Tesla Superchargers make up 60% of all fast chargers in the United States and Canada, according to US Department of Energy data.

“It’s huge,” said Chris Hardow, senior policy analyst at Consumer Reports. “I could see this being a snowball effect of more automakers jumping on board and moving toward the Tesla standard.”

For GM and Ford, the benefits of the deals giving customers access to Tesla’s extensive rapid charging network outweigh the risks that their customers will like what they see and choose Tesla for their next purchase.

The alliance between Tesla, GM and Ford is putting pressure on other automakers and independent charging network operators to adopt the CCS standard. The U.S. move to Tesla’s standard could be difficult for rival charging station manufacturers, which already manufacture equipment that complies with CCS standards in the U.S.

Referring to Tesla’s North American charging standard, Morningstar Research’s David Whiston said, “NACS is more likely to succeed in North America than CCS. Other charging providers may still use the CCS standard and rely on adapters to service Tesla, Ford and GM vehicles,” he added.

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Shares of charging companies ChargePoint ( CHPT.N ) and EVGO ( EVGO.O ) fell more than 4% in after-hours trading on Thursday.

GM said it will equip EVs with connectors based on the Tesla North American Charging Standard design starting in 2025. Next year, existing owners of GM EVs will be able to use 12,000 Tesla Fast Chargers in North America, with adapters also available.

Musk said Tesla “isn’t going to do anything to love Tesla” as more competitive brands gain access to the Supercharger network. “It will be a level playing field … the most important thing is that we will lead the electric vehicle revolution.”

Ford CEO Jim Farley had a similar discussion with Musk on Twitter last month, announcing that the No. 2 U.S. automaker had struck a deal with Tesla to give its electric vehicle owners access to more than 12,000 Tesla Superchargers in North America by early 2024.

Additional reporting by Peter Henderson, Sayantani Ghosh and Matthew Lewis, David Shepherdson in Washington and Joseph White in Detroit, Hyun Joo Jin and Abriob Roy in San Francisco, Kannagi Deka and Niketh Nishant in Bangalore and Jared Renshaw in Philadelphia.

Our Standards: Thomson Reuters Trust Principles.

Joseph White

Thomson Reuters

Joe White is a global automotive correspondent for Reuters based in Detroit. Joe covers a wide range of auto and transportation industry subjects and writes for The Auto File, a three-times-weekly newsletter about the global automotive industry. Joe joined Reuters in January 2015 as lead transportation editor for planes, trains and automobiles, and later became global auto editor. Previously, he served as global auto editor for The Wall Street Journal, where he oversaw coverage of the auto industry and ran the Detroit bureau. Co-author (with Paul Ingrassia) of Comeback: The Fall and Rise of the American Automobile Industry, Joe shared the 1993 Pulitzer Prize for Beat Reporting.

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