General Motors Joins Ford in Adopting Tesla's Charging Standards
General Motors (GM) follows Ford's lead and embraces Tesla's charging plug standard, paving the way for unified EV charging hardware in North America.
Under this agreement, GM electric-vehicle buyers will gain access to the renowned Tesla Supercharger network. The news was revealed during a Twitter Spaces event featuring GM CEO Mary Barra and Tesla chief Elon Musk. This development has been met with enthusiasm from investors, resulting in a more than 4% rise in shares for both GM and Tesla.
This collaboration between the three leading EV manufacturers in the United States holds significant implications for commercial and public policy.
In order to be eligible for federal subsidies for new charging stations on major U.S. roadways spanning 7,500 miles (12,070 km), the Biden administration had mandated the adoption of a rival "combined charging system" (CCS) standard. However, the alliance formed by Tesla, Ford, and GM challenges the administration's directive. Transportation Secretary Pete Buttigieg acknowledged in a CNBC interview back in May, following the Ford-Tesla deal, that the industry will eventually converge on one system facilitated by adapters for cross-usage.
Together, Tesla, GM and Ford currently dominate approximately 70% of the U.S. EV sales market. Industry experts view the divergence in EV charging connectors as a barrier to widespread consumer adoption of electric vehicles.
Musk expressed his optimism about the advancement of electric vehicles during the Twitter Spaces conversation with Barra, stating, "I think this is just going to be a fundamentally great thing for the advancement of electric vehicles." Barra echoed this sentiment, saying, "I think it all just got a little better."
According to Barra, GM stands to save $400 million as a result of this agreement, as she revealed in an interview with CNBC. From a consumer standpoint, these deals with Detroit automakers present a win for Tesla, which invested significantly in establishing its distinctive fast-charging network across North America while most other automakers relied on third-party charging solutions. U.S. Department of Energy data shows that Tesla Superchargers account for approximately 60% of all fast chargers in the United States and Canada.
Consumer Reports senior policy analyst Chris Harto hailed this development as significant, stating, "This is pretty huge. I could see this being kind of a snowball effect of more and more automakers jumping on board and shifting towards the Tesla standard."
For GM and Ford, these agreements represent a gamble that providing their customers with access to Tesla's extensive rapid charging network outweighs the risk of losing customers who may choose Tesla for their next purchase.
The alliance formed by Tesla, GM, and Ford creates pressure on other automakers and independent charging network operators that had adopted the CCS standard. Transitioning to Tesla's standard could prove challenging for rival charging station manufacturers who have already established operations in the United States and manufactured equipment conforming to CCS standards.
David Whiston of Morningstar Research commented on the situation, stating, "It does make it much more likely that NACS will win out in North America over CCS," referring to Tesla's North American Charging Standard. He added that other charging providers can still utilise the CCS standard and rely on adapters to accommodate Tesla, Ford and GM vehicles.
GM plans to equip its EVs with connectors based on the Tesla North American Charging Standard design starting in 2025. Additionally, starting next year, current GM EV owners will be able to utilise the 12,000 Tesla fast chargers available across North America, with adapters being made accessible.
Musk reassured that Tesla "is not going to do anything to prefer Teslas" as other rival brands gain access to the Supercharger network. He emphasised the importance of advancing the electric vehicle revolution on an even playing field.
Ford CEO Jim Farley engaged in a similar discussion with Musk on Twitter last month, announcing that the second-largest U.S. automaker had reached an agreement with Tesla. This agreement will enable Ford's electric vehicle owners to access over 12,000 Tesla Superchargers in North America starting in early 2024.
GM and Tesla have reached an agreement to allow GM electric-vehicle buyers access to Tesla's Supercharger network, leading to a rise in shares for both companies.
The alliance challenges the Biden administration's mandate for a rival charging system standard, creating implications for commercial and public policy in the EV industry.
Tesla, GM, and Ford, who currently dominate the U.S. EV market, aim to address the divergence in charging connectors and promote widespread consumer adoption of electric vehicles.