The past, present, and future of the charging market in the United States and how it impacts the rate of adoption of electric vehicles.
The Charging Situation In The US Yesterday & Today
If you don’t care about the past and just want my speculation on the future, jump to the next section. In some ways, the situation is much better than when I ordered my first electric car in 2010 (a Nissan Leaf). When I picked up my Nissan Leaf in 2011, there were about 10 level 2 chargers around Tampa Bay and no fast chargers. For the first year, I mostly just charged at home. By 2015, there were many more level 2 chargers around town and even a couple of fast chargers. I would start to take the Leaf (which had a 70-mile range) on 100-mile local trips where I would plan to fast charge at the halfway point. It was difficult, since the fast chargers were at Nissan dealers that were only open during certain hours and only had one fast charger. That charger was frequently broken, used by another Leaf owner, or blocked by a gas car. As a backup, I could always sit at a level 2 charger for two hours to get back home. As you can imagine, this is fine for an enthusiast, but way too much work for a “regular Joe.” I never was brave enough to drive the car to Orlando, since highway speeds greatly reduced range and it would be drive 30 minutes, charge 30 minutes, repeat. This is if all the fast chargers were working. If you ran into a broken charger, replace charge 30 minutes with charge for 6 hours (I only had 3.3 kW charging, so 15 miles an hour). I know people who were
stupid brave enough to do this, but I wasn’t.
So, for the last 5 years, I’ve driven a Tesla and charging is a breeze. I have a level 2 charger in my garage, and with 300 miles of driving range, I never need to charge for running errands around Tampa. For trips, the Supercharger network has been great. I did notice a couple of issues on my 1000+ mile trip to North Carolina. There are plenty of chargers to go there, but I found they were about every 40 or 60 miles, so while I’d like to charge my car when it is at 30 miles left (so it charges at a fast rate), I sometimes have to charge when it has 80 miles left, because it is a bit risky to pass the charger when the next one is 60 miles away. The other problem would be that there would be two routes between large cities, one on the interstate highway and another on other roads. I might want to take the non-interstate route to see an attraction or just because it is a scenic drive. Usually there were only Superchargers on the interstate route.
Even around town it isn’t ideal. I had many free Supercharger miles from referrals, but I would rarely use them for in-town driving since all the Superchargers were by the interstate (a 30-minute round trip south of my home), while all the places I go regularly are north and east of my home. I’ve encouraged all 3 of my children to drive electric cars or plugin hybrids. All three lived in apartments last year, and this year all will live in houses. When I wrote this article almost 5 years ago on 7 reasons why not to buy a Tesla yet, my point #7 was that you don’t have a place to charge it. I certainly thought in 5 years that this would have changed more than it has. Most workplaces in Tampa still don’t have chargers. Most apartments in Tampa don’t have chargers. If they do, they have one charger to be shared by 200 residents and it is broken half the time. The problem with slow chargers is they are great if they are where you sleep or work, but if they are 2 miles from your house, that is too far away, especially for busy people with kids. Slow chargers at the grocery store or gym or mall are okay, but I usually only spend an hour there, and adding 30 miles of charge isn’t enough. Apartments and workplaces haven’t added level 1 or level 2 slow chargers as fast as I expected 5 years ago. Will that change in the next 5 years? Yes, but probably more slowly in many areas than needed to support wide adoption of EVs.
So, what did my children who had electric cars or plugin hybrids do last year when they lived in apartments? My daughter with a Tesla would spend an hour charging at a Supercharger twice a week (30 minutes charging and 15 minutes out of her way driving to and from the charger) — not ideal. My son only lived a mile from his work, so he could go weeks without charging. When he would take a trip out of town, the Supercharger was on his way, so not a problem. In his last townhouse apartment, the outlet in his garage wouldn’t support 120V charging (we never figured out why), but he could run a cord into his kitchen and that outlet worked for slow charging. My daughter with a plugin hybrid loved to charge when it was convenient, but the last two years, the slow level 2 chargers were a half mile from her apartment and she found that walk too much to add 13 miles of range to her car, so she never charged at all.
How GM’s & Ford’s Announcements Change Things
A year ago, I thought Tesla may change its North American cars to use CCS. I knew the connector wasn’t as good, but I thought the company might do it because Ford, GM, Hyundai, Kia, VW, Nissan, Toyota, Honda, Subaru, Rivian, Lucid, and Fisker electric vehicles all used and planned to use CCS, and that would be millions of cars a year, so there would be a lot of chargers Tesla owners couldn’t use without carrying around a $300 adapter (now $175 from Tesla and $89 on Amazon). Well, those other companies aren’t selling a lot of electric cars yet. They like to talk about electric cars, but they don’t really build many of them for sale in the US. Until recently, they would send their best electric cars to China and Europe, since the US didn’t have good incentives nor requirements for electric cars. Now, the US has great incentives, but they are tricky to access. You have to figure out how to build them in North America and get your supply chain to get the materials from the right countries to qualify for the $7,500 tax credit (or use the leasing loophole). Now that GM and Ford have announced they are going with both the Tesla connector and the Tesla Supercharger network, it looks like the vast majority of EVs in the US will use the NACS or Tesla connector.
Last year, according to CleanTechnica and GoodCarBadCar.net (Tesla doesn’t break out sales numbers by country, so US Tesla sales numbers are always estimates), Tesla sold over 500,000 vehicles. Assuming Tesla can continue its plan of 50% growth, by 2026, it will sell almost 3 million cars a year in the US.
Ford has plans to have capacity to make 2 million electric vehicles a year in North America, if you include the commercial vehicles by Ford Pro, while GM plans to have capacity to build 1 million electric vehicles a year in North America (but that is mostly the US) in 2025. I expect Hyundai, Kia, and VW will likely also soon announce they are going to use the North American Charging Standard (NACS, or Tesla Connector), since it will be a huge liability to only have access to a small fraction of Tesla Superchargers that have the Magic Dock Adapter. So, this means that over 12 times as many vehicles (500,000 to over 6 million annual run sales) will share Tesla Superchargers for either trips or their regular changing (since apartments and workplaces are dragging their feet on installing chargers).
How Will Tesla Meet The Greatly Increased Demand For Charging?
Tesla has made several statements on this, which suggests it will use a 3-pronged strategy.
- Increase charging speeds. Tesla recently increased the max speed of most of its Superchargers from 150 kW (V2) to 250 kW (V3), and version 4 looks like it will up the power to 600 kW. Now, I realize that not all cars can charge at the maximum rate, and even the cars than can, can only charge at that rate for a short time before they slow their charge to protect their batteries. That being said, this should cut the average charge time in half or so and mean the same number of chargers can support twice the number of vehicles. I find I can usually get the charge I need in about 20 minutes at a V3 charger vs. about 35 minutes at a V2 charger. Future vehicles on a V4 charger might get down to 10 minutes.
- Put more chargers in existing locations. Most of the original Superchargers had 6 or 8 stalls, while in busier areas, Tesla expands that to double or triple or even more than that. I see this report of 164 stalls being planned for Harris Ranch in California. That beats the largest gas station in the world, a Buc-ee’s in Texas outside of San Antonio that has 120 gas pumps. Of course, gas pumps only take 5 minutes to fill your car, so you can fuel more cars per hour with 120 pumps than 164 chargers, but it is getting close.
- Adding more locations. Whereas today you sometimes have long gaps of up to 80 miles between Superchargers, or even no superchargers on some routes, within 3 years, I expect on most highway routes there will be a Supercharger at every rural exit or about every 20 miles. In some locations, instead of building a large Supercharger that has 100 stalls, it makes more sense to create two Supercharging stations with 50 stalls at each. Put one on each side of the road so that drivers don’t have to spend 5 minutes crossing to the other side if they are traveling in the “wrong” direction. I found a Supercharger in Lakeland that is only a mile from the Interstate, but the traffic is so heavy that it takes about 20 extra minutes to stop there for a charge. They can also put more Superchargers in residential neighborhoods, since many people live in apartments and although they should install level 1 or level 2 chargers, they just aren’t doing it. If Tesla puts a Supercharger on my regular route, people won’t mind stopping for 10 minutes once a week to fuel up while they wait for their apartments to install chargers.
More than half of the 40k+ Superchargers around the world were made by our incredible 2000 person team in Buffalo!
Giga New York is also making the next generation of Tesla Superchargers and Semi chargers ✌️ pic.twitter.com/8DiQ7UmU6K
— Tesla (@Tesla) March 15, 2023
Tesla is preparing for a massive expansion of its charging network. In addition to its massive factory in China, with capacity to produce 10,000 chargers a year, Tesla also uses its New York gigafactory to build Superchargers. In an application to the government a year ago, we got a glimpse of Tesla’s costs to build and install a charger. It should surprise no one that Tesla’s costs were as low as $30,000 a charger, about a fifth of most other applicants. I found the video below interesting, so I thought I would share it as well.
Conclusion & A Surprising Twist
The implications of Ford & GM supporting NACS are:
- There is no chance Tesla will switch to CCS anymore, the momentum is with them.
- It seems likely that all other EV manufacturers will follow Ford & GM. If they don’t, they really won’t be competitive, since nobody wants to buy a vehicle that they can’t use freely.
- If my prediction of many more Superchargers being installed soon comes true, the market for a less expensive electric vehicle with 200 miles of range instead of 250 to 400 miles of range may emerge. There is already a supply of 200 mile range vehicles (the 5 year old, 250 mile range vehicles that have lost 20% of their range), but the supply of used EVs is very low for two reasons: 1) there were very few EVs sold 5 years ago; 2) the people who bought them like them, so they tend to keep them. This means a manufacturer could find a market for less expensive, lower cost EVs that are viable now, simply because the charging infrastructure is greatly improved and quickly getting better.
- Although I disagree with his take on plugin hybrids (they can be a great bridge to EVs for consumers not ready to make the leap), this article explains how many or even most people who didn’t think they could buy an EV now can. The chargers are now there in most cases and the costs are low enough.
If you want to take advantage of my Tesla referral link to get Reward Credits, here’s the code: https://ts.la/paul92237 — but as I have said before, if another owner helped you more, please use their link instead of mine. If you want to learn more about Tesla’s new referral program, Chris Boylan has written an excellent article on it.
Disclosure: I am a shareholder in Tesla [TSLA], BYD [BYDDY], Nio [NIO], XPeng [XPEV], Hertz [HTZ], and several ARK ETFs. But I offer no investment advice of any sort here.
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