Tesla looks to be opening up its charging network to drivers of other EVs. That is probably a smart move, but it comes with one risk.
News of the evolution in Tesla ’s charging policy didn’t come directly from the company. It arrived via Twitter. which feels appropriate given Tesla CEO Elon Musk’s 100 million-plus followers and his tendency to use the social-media platform to comment on what is going on at the company, as well as many other issues.
Tesla investor Sawyer Merritt broke the news, which has been picked up by several media outlets, on Wednesday. Merritt is active on social media, posting frequently about Tesla. He has more than 280,000 followers.
Tesla didn’t respond to a request for comment about charging network changes.
Merritt told Barron’s on Thursday the option for charging non-Tesla EVs was still available in the Tesla app. We downloaded the app and found the option for non-Tesla owners to charge, although when we tried in Fairfield County, Conn., the app said no Tesla chargers near us were available for non-Tesla drivers.
Tesla seems to be rolling ahead incrementally with the non-Tesla EV charging plan. Musk has said Tesla probably would allow non-Tesla vehicles to use its network, and the company introduced a pilot project to do so in Europe in November 2021. Now that plan appears to be moving to the U.S.
The reason a non-Tesla driver would want to access the Tesla network is pretty obvious. Tesla has one of the largest networks of fast chargers on the planet. Fast chargers can deliver 50 or 100 miles of range in minutes, which is much quicker than refueling via a wall outlet at home.
Tesla has plenty of reasons to expand the availability of its network. Not only does having more users for the chargers bring in extra revenue, but opening up the system likely makes it easier to access federal funds earmarked for building EV-charging infrastructure. More sales and lower capital costs amount to a pretty good deal.
Of course, Tesla runs the risk of irritating Tesla drivers if its charging stalls are all full of, say, Chevy Bolt EVs, when they pull up to charge. That is a significant danger, but EV penetration is much higher in Europe than in the U.S. Overuse of chargers doesn’t seem to have become an issue across the Atlantic, where the pilot started.
Tesla didn’t respond to a separate comment about usage and government support.
Just how much Tesla could juice its sales and earnings by letting other cars use its network is hard to say. Goldman Sachs GS +0.22% analyst Mark Delaney recently wrote that it could add $1 billion to $3 billion in sales a few years down the road. That revenue could add about 75 cents a share to bottom-line results.
Tesla is expected to make north of $20 a share in 2024, so 75 cents isn’t too significant. Still, it certainly doesn’t hurt.
The stock was down 0.3% in Thursday trading, while the S&P 500SPX +0.23% had lost 0.2%. The Nasdaq CompositeCOMP +0.21% was flat.