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Comment by avalys | Hacker News Reader

I think this is great but I continue to wonder about Tesla's plan here.

The Supercharger network is one of their remaining competitive advantages. Other manufacturers were behind for years on efficiency, range, etc. but are now catching up - and other manufacturers are far better at making an actual _car_ than Tesla. Build quality, quality control, durability, comfort, noise, etc.

Unless Tesla is so confident that their manufacturing skills will give them a continuing and durable cost advantage - that makes up for the fact that they haven't innovated or even improved their basic vehicle design for the past 10 years - I don't see how this works to their advantage.

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First - Tesla had to open charging to other manufacturers to receive additional governmental subsidies. Second - Tesla will get addition 7 plus billions grants to add additional charging infrastructure. Third - Tesla will add at least another 10 to 20 billion in charging revenue with at least 30 percent profit to the bottom line. Forth - Once all the other manufacturers signs on, they can offer other services… IMHO

Plus if their standard takes hold they don’t end up being the next BetaMax of history.

It's definitely a case where network effects are good for everybody. Like you can travel across say lower Michigan on the Supercharger network right now, but there's ~2 planned stop routes from the Mackinac Bridge to Detroit, it's tenuous, not some huge lead.

Tesla isn't doing this out of the kindness of their heart, they make money off of charging cars. I bet the money they make off of charging stations comes easier too. Like they really just need to pay for maintenance. Compared to building cars, delivering them, providing service, etc. it's kind of a no-brainer to just make tesla chargers able to charge all EV's and just keep building out that network.

But why wouldn't someone (really, anyone) be just as equipped to build out NACS stations? Each new manufacturer switching over to NACS means the really big companies (bp, Shell) who already have tons of physical land and infrastructure, will be more incentivized to serve NACS, doesn't it?

Hopefully Buys out, Partnerships or Rents out all that Real Estate

Don’t know about BP or Shell but local power companies seem prime to take over that space. Tesla relies on them for power. I don’t see why the local power companies won’t cut out the middle man that’s Tesla and service customers directly.

> local power companies seem prime to take over that space

Theoretically yes, but in action they are hemmed by their regulators as they are quasi-public owned and operated.

In theory, they could do this, but local power companies are so regulated and bureaucratic that they'd never be able to take on building and maintaining charging stations for cars. At least that's how it is where I live (I have family that works at my local power company)

I'm not sure that the current locations that companies like BP and Shell have for gas stations would work for EV charging station.

According to what I've read most gas stations make very little profit if any on gas sales. It is the things they sell in the accompanying convenience store where they make their money.

An average ICE "charging" at a gas station adds mileage around 15x faster than the fastest charging EV at a Supercharger. If you convert an existing gas station location to an EV charging station that means that the number of cars you can handle per hour goes down by more than an order of magnitude, which means your convenience store sales will go down.

The convenience store sales probably won't go down by an order of magnitude because there are usually a significant number of people who come just for the convenience store and don't refuel their car. Still, I'd expect that at a lot of locations that drop of in convenience store visits from people who are there to refuel will be enough to make that location not profitable.

Well I think the business model would change a bit and e.g. you’d probably see convenience stores being converted into something more lounge-y. No matter how you slice it, having real estate at every high-traffic location in America is a much better position to be in than not having such real estate. Especially given that those companies have gargantuan war chests, are technologically, logistically, and financially extremely sophisticated, etc etc. Not to mention they also own the fuel sources that generate most of the electricity, and they’re the largest players even in the next generation energy sources.

There might be something I’m missing, I just don’t see why this would be anything close to a durable advantage for Tesla.

> I'm not sure that the current locations that companies like BP and Shell have for gas stations would work for EV charging station.

North America is behind on EV infrastructure. The current fighting over which plug to use will delay it by some more years. In Europe there are many fuel station style charging locations. For example:

- Shell: https://www.youtube.com/watch?v=qR2M5W6saAk

- Circle K: https://www.youtube.com/watch?v=4TVohXHjLro

- GridServe: https://www.youtube.com/watch?v=FoN4WCpuxHY

- BP: https://www.youtube.com/watch?v=s1PZJtnuiIU

> 15x faster than the fastest charging EV at a Supercharger

Shell's new station has 400 kW CCS chargers, but the problem is on the battery side more than the charger side. EVs can't make full use of the charger's available power across the whole charge curve. Better, fast charging batteries are needed.

The plan seems very clear to me. They developed a better charger that helped kickstart the market and gave them a competitive advantage. In the future, differentiating on a charger becomes a disadvantage as the EV market gets larger and Tesla owns a smaller percentage, meaning most charging stations will not be compatible with Teslas. The inflection point between the charger being a competitive advantage/disadvantage is occurring around now. Additionally, licensing the rights to the charger gives Tesla a stake in the entire EV market as a whole.

All Teslas sold today are compatible with CCS chargers.

Unless you found yourself in a spot with no other options, I can't imagine any Telsa owner would choose to use a CCS charger that is a worse experience for them in every way.

I wouldn't go out of my way for it but there happens to be an EA charger more directly on the route I frequently travel. So it's nice to have the option.

Software compatible. Still have to spend $175 for the physical adapter, it does not come with the car. No charger, in fact, comes with a Tesla these days. I did buy the adapter, of course, because though I may not ever use it I like having the option.

Their business plan is that they know they won't make every EV that is sold, but they will make money by charging many more than they sell.

The list of Manufacturers on board at this time: Ford, GM, Rivian, Volvo (and presumably Polstar).

Hyundai and Stellantis are considering it. If they join, and it'd be silly not to at this point, that's about half the car market right there. Now it's just up to the German and Japanese automakers.

Also, SAE (the Society of Automotive Engineers) just announced that they are formally adopting NACS as the standard moving forward for North America.

https://www.theverge.com/2023/6/27/23775208/tesla-nacs-elect...

> Their business plan is that they know they won't make every EV that is sold, but they will make money by charging many more than they sell.

That's such a tough market, though. They make thousands of dollars per car they sell. Fast chargers are for road trips, which means most EV owners don't rely on them day-to-day. Making the same thousands of dollars of profit from fast charging is no small task. And given it has to be made over the long haul, it's even harder to get the same value.

Combine that with the fact that there are already lots of non-Tesla fast chargers and there will be ever more going forward, and I think this business decision looks risky. I can only interpret it as a statement on what they think is going to happen to their new car profit margin.

Sure, but they also get to remain the leader and not have to change all of their cars and chargers, so it's a convenient way to make some surplus revenue. The next closest company in terms of charging infrastructure is VW and they're nowhere near Telsa.

> other manufacturers are far better at making an actual car

Are they really "far better"? My wife's Tesla hasn't had any issues in the last 3 years. The build quality is great. Every time I have a chance to take the Tesla over my Kia, I do it because it's so much more pleasant to drive it.

Over the years I've had many cars. I am struggling to think of one better than the current Tesla that we have.

Are the cars on the same price level?

After the rebates (here in Southern California), Tesla Model 3 is actually cheaper.

What other brands have you owned? Kia is not a luxury brand. Tesla competes in the luxury segment

To be fair, Kia EVs are in the same price range as Teslas.

Good point, the EV6 and Model Y are comparable in price. I suppose I’d be curious to know if GP was referring to an EV Kia

For one thing, other car manufacturers succeed in making the car look good. if you don't mind driving around in a bar of soap, Tesla is fine.

Looks are subjective.

Exactly, I don't want an ugly car. One of the numerous things I love about my Model Y is how awesome it looks. Screw the Ford, GM, Chrysler, Subi, Toyota, etc bars of soap.

Soap bar?

Someone mentioned Teslas look like half an egg, and now I can't think of anything else when I see one.

I think the appearance is largely defined by its aerodynamics. people may be calling for them to make arbitrary changes in appearance but i’d rather they keep the functional shape.

This lets them bring in tons of money from owners of other manufacturer's cars using their chargers. It also means they don't get forced into CCS in NA which was the probable alternative path to convincing other manufacturers to use their NACS hardware.

The supercharger network is just a drop in the bucket compared to what they make from selling new cars. And there will be quite a lot of competition for fast chargers, there's no moat at all there. It's an interesting business decision.

Tesla is confident in their economic skills. They have multiple sources of revenue, both one time (they have massive margins on cars) and recurring (selling software on cars, and money from the Energy division, plus now from charging), and they have a LOT in the bank (a sweet 15-20 Billion cash, iirc).

Other legacy companies have loads of baggage, and they cannot compete. [1]

Supercharging is no longer the moat they must have, and they are willing to drain it to increase more revenue from the access instead.

----

[1]: https://www.theverge.com/2023/6/27/23771407/ford-f150-lightn...

They generate a decent profit on supercharging and increased usage = increased profits.. On the maufacturing side market is saturated with Teslas. They keep dropping the price to increase demand but you can only play that game for so long.

Sandy Munro currently believes that Tesla is 5 years ahead. Heck, even the Ford CEO has openly said that it’s very hard to catch up to Tesla in terms of software, batteries, and vehicle design [1]. For example, here is a video explaining the differences in the Tesla vehicle manufacturing over the years [2].

[1]: https://youtu.be/JdId8tXiJIo

[2]: https://youtu.be/WNWYk4DdT_E

I think this is their way of saying the current profit margins aren't going to persist. It is exceedingly difficult to make a fast charging business with the kind of profit margin they currently rake in on new car sales, so giving up the single biggest reason people buy a Tesla is a statement unto itself.

> The Supercharger network is one of their remaining competitive advantages.

Not really. Tesla chargers are slow and low voltage compared to other charger manufacturers. Other charging networks are deploying 400 kW chargers. Like FastNed has deployed 400 kW chargers from EVBox and Alpitronic:

- https://fastnedcharging.com/hq/fastned-and-evbox-join-forces...

- https://www.youtube.com/watch?v=T4ZWN_-a2j4

Seems like you answered your own question. Tesla realizes that other makers are at least perceived to be better at making actual cars. It's immaterial whether that's actually true (though I personally happen to believe it is) because perception is what matters in the market. Therefore, continuing to focus on cars is a losing strategy. They're pivoting to their only real long-term differentiator, which is the charging network and the hardware that connects to it. The interesting question here IMO is when they made that choice.

They were probably forced their hand here by the US Government, which is really sad given that the rest of the industry basically got a free pass for shunning EV adoption for years.

That said, this is definitely making me interested in a non-Tesla for our next EV. Tesla's tech is unrivaled, but the competition has better hard products.

Once the competition's lane-keeping/"smart" driving catch up to Tesla's APv2, I think I'm out. Even though I absolutely love using FSD beta.

This would mean they are a nationwide power company with the ability to charge more kWH for reduced charging time. Add in solar panels,battery banks, and optimizing recharging with the local power company and it's printing cash at that point.

I think it's also that the EV market needs better charging stations, that are more reliable as the existing charging brands have a bad reputation. Tesla also needs charging stations to work for non-tesla vehicles or the trust in a EV would drop.

> Supercharger network is one of their remaining competitive advantages

NACS for Ford doesn't mean a Supercharger experience. Tesla's tight integration will continue to yield fruit for at least a few more years.

NACS for Ford does mean a Supercharger experience.

https://media.ford.com/content/fordmedia/fna/us/en/news/2023...

Allegedly once a physical adapter comes out all existing CCS Fords will be able to access the Supercharger network with Plug and Charge.

> NACS for Ford does mean a Supercharger experience

The Supercharger will still be talking to a Ford-built port connected to a Ford battery run on Ford software. I’m optimistic. But it’s not as tight as Tesla all through.

Speaking for myself, but although I loathe Elon and deride Tesla’s build quality, there’s truly nothing like driving around a Plaid Model S for it’s absolutely tearjerking speed. The weird steering wheel continues to annoy, however.

Stepping back though, one can get a performance Model 3 very inexpensively, relatively, and as far as I can tell or have seen, no other manufacturer outside of Porsche (with BMW making some minor inroads) has electric cars close to as fast.

So if given a choice between a ridiculously fast Tesla and a, say, much slower Volvo for the same or more money, I’ll go with the Tesla. Not that I base the entire purchase on acceleration performance, but all else being relatively equal I will be driving a Tesla until others catch up.

I couldn’t disagree more.

Anything that does 0-60 in under 10s is fast enough for me. I’d rather have a quieter and more comfortable ride. I have an actual race car to race on an actual track and don’t need to endanger myself or others going Plaid speeds on public roadways.

I have a 5 year old Avalon Hybrid that was in the bodyshop and rented a Tesla for a month and it was awful. Brand new and it felt like I was driving a Wish.com golf cart. The only redeeming feature was the supercharger in my building.

that’s not the experience most of the drivers desire

I'm not arguing, but do you have a source for this? I happen to agree with GP. I'm 55, I want a quiet, comfortable car. I don't care about performance.

Nor is it the experience anyone with a Tesla experiences. Nothing else comes close to Tesla in build quality (My wife's Subi Forrester is a flaming POS in comparison) or driving experience. Every other car company makes vehicles to make money, and fail on target after warranty (or in the case of Ford during warranty costing Ford billions in warranty costs). Tesla seems to "break" capitalism, they make their cars to last and NOT break.

I'm intrigued by this. I own a 2017 forester and it is rock solid. I, my family, many friends, have all owned Subarus extensively, and build-quality/fit-and-finish have never been an issue, including on some quite old vehicles.

I would very much /like/ to own a Tesla, but I hear so many bad things about loose panels, road noise, touchscreen interface, problem getting repairs, and even that the Subaru's adaptive cruise control is better than the Tesla. It's hard to justify moving away from a brand which has been absolutely reliable though.

So I'm very interested in hearing that your experience is that the Tesla has actually been better. If you don't mind: which Tesla model/year do you have experience with? I'd be interesting in determining if they're getting better, or started out great and perhaps getting worse.

There may be regional differences. Most people I know that have teslas complain about shocking build quality issues, with the exception of the cars built in China.

The acceleration of the model 3 has already helped me avoided a few accidents.

That acceleration isn’t useless.

I feel you, I was chatting with my dad and he said something similar. Your framing as either or though isn’t quite right. I’ve found that the Model S is quite comfortable and quiet inside.

I also think it would be a very cool experience to drive a race car on a track, and I’m glad you get that experience. But I don’t see my interest in that extending or being prioritized enough to make the time and financial investment for such a specific thing. But your framing is again problematic, probably unknowingly, because having a car that can go fast and “going Plaid speeds on public roadways” with the race car comparison conjuring images of irresponsible drivers is almost entirely orthogonal to actually owning such a car.

But Lucid Air Sapphire blows Tesla Plaid out of the water better top speed, range, interior, just nicer, better quality, and a not stupid steering wheel.

$250,000

Ok.

> no other manufacturer outside of Porsche (with BMW making some minor inroads) has electric cars close to as fast.

Off the top of my head, the Ford Mach-E GT and the Kia EV6 GT are also sub-4 second cars.

I expect the blinding acceleration to become just a feature most EVs have some version of. Even the Bolt is pretty quick for a compliance car (nearly as fast as a VW GTI, the quintessential hot hatch).

Personally, having owned a Model 3 Performance, I finally figured out that there was such a thing as too much power. It's a great party trick, but as a practical matter I think I'm quite happy with anything sub-5 second.

the plaid, i believe, is sub 2s. it is a vanguard product. i believe they use the same motor in the semi- so, in hindsight, they started with impractical fun but had an eye on practical power down the way. This is rather smart, no?

FWIW, you can get it with a normal wheel. In fact, the yoke is a $250 upgrade. Elon originally said it would only be available with the yoke but apparently he relented.

I did not know this! They didn’t have that option to my knowledge when I got mine. Probably doesn’t matter at this point as I’m mostly used to it, but good to know.

Maybe they foresee that the actual electric cars will be on par in the near future and hence focus on being the leader in energy distribution.

They've been clear since day 1 they are an energy company, not a car company.

This is a narrative grafted on after the fact. When Eberhard and Tarpenning founded Tesla - years before Elon was involved - it was founded as a car company.

> Tesla was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors. The company's name is a tribute to inventor and electrical engineer Nikola Tesla. In February 2004, via a $6.5 million investment, Elon Musk became the company's largest shareholder. He became CEO in 2008.

Seems like a choice between continuing to compete in one market, or competing in the same market while also absolutely dominating another.

Which market is the one they will dominate? Supporting NACS is not a hurdle, and there are already quite a lot of non-Tesla DC fast chargers in existence. Some of them have already announced they'll add NACS plugs themselves. There's no magic to building another charging station, and if everyone supports plug-and-charge (or hell, just reliable credit card processing), it'll be a super competitive market with tight margins.

All well and good to say, but every other company that has tried to charge EVs has utterly failed, and it's been over a decade now. Once customers can move freely between all the networks, the ones with bad reliability will disappear. Right now that's every network not Tesla. Like you said, the margins are tight. EA can't just lower their prices. And even if they could, who's gonna take a chance on a shitty network during a family road trip to save a couple bucks? Not me.

> but every other company that has tried to charge EVs has utterly failed

You need a broader perspective. Europe is a bigger EV market than North America is at present. European charging networks that are going strong, offer faster charging than Tesla, and are growing include Fastned, Circle K, EnBW, Ionity, Shell, BP, etc.

They've had the benefit of Europe standardizing on CCS type 2 Combo. When everyone can build to the same standard it drives investment and development.

This is the North American charging standard. North America previously standardized on CCS1 (which is exactly the same as CCS2, but without 3-phase support, which we don't need here) and it has done nothing. My perspective is plenty broad. What point are you trying to make, exactly? That if we just continue doing exactly as we have, NA will turn into Europe eventually?

> CCS1 (which is exactly the same as CCS2, but without 3-phase support, which we don't need here)

No, it's a mechanically different plug.

> What point are you trying to make, exactly?

That every other company that has tried to charge EVs has not utterly failed. Your perspective is narrow and it has caused you to believe a falsehood.

Okay, I sincerely apologize for not saying that "every company in North America" has failed. I probably just figured that since this whole conversation is about the North American Charging Standard it was implied. But you are right. There are companies in Europe that have succeed. Maybe Mars too? Haven't been there, not driving my NACS car there, but you can win that argument too, if you like.

And the plug is mechanically different in that it has one fewer pin due too... drum roll please... no 3-phase support. But it is mechanically different, so you can win there too, if you like. Look at you! Winning all the pedantry awards today. So much fun. I mean, we're not having a damn conversation about anything, just arguing over every single word I say that you can possibly find an issue with, but to some people, this is as much fun as you can have.

Pi is exactly 3.

> Okay, I sincerely apologize

I don't have much use for your sorrys. It's better you think about what you're saying rather than running around in ignorance. Your narrow outlook prevents you from seeing better alternatives.

> And the plug is mechanically different in that it has one fewer pin

No, Type 2 has a different shape and two more pins than Type 1. CCS type 2 is used in more countries than any other EV plug.

Have a read:

https://en.wikipedia.org/wiki/Combined_Charging_System

Broaden your horizons.

Lol, who talks like this?

Like I said, you are right about everything. I'm an uncultured imbecile. I'll start reading more, going to museums. I'll travel the world. Europe is paramount when considering US charging infrastructure. The shape of a connector is the most important part. Can we move on and have you tell me your point? What do you actually have to say about Volvo adopting NACS?

> Europe is paramount when considering US charging infrastructure.

It is when you want an example of how to do it right. Europe is a long way ahead of North America in EV infrastructure because of sensible standardization.

Learn from Europe. Europe does EV infrastructure better.

> I don't see how this works to their advantage

It probably doesn't, apart from some kind of bragging rights about how their charge connector standard won in North America (which however facile, is important to the most zealous among their customer base).

Tesla was forced to open their charging network to become eligible for federal tax credits. If Tesla starts preferencing or discounting charging for their cars in their network going forward, they will lose those credits and perhaps get in other trouble.

Given that, they are making the best of the situation by partnering with their competitors, who themselves failed to have Tesla's foresight about the importance of a comprehensive charging network - even after Tesla clearly demonstrated the value in that. Remember, VW was forced to create Electrify America as part of the Dieselgate settlement.

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