Elon Musk’s sudden decision to lay off employees in charge of Tesla’s electric vehicle charging business comes as the company prepares to outfit new EVs so customers can take advantage of the Tesla Supercharger network. It blindsided automakers, industry officials and analysts said Tuesday.
General Motors, Ford and other automakers that signed deals last year to provide customers with access to the network have so far said they have no plans to change their plans.
Tesla’s decision to open its network to competing EV manufacturers was welcomed by President Biden, paving the way for Tesla to receive federal grants to expand coverage of the North American Charging Standard (NACS) system. .
Mr. Musk’s decision is According to the information,laid off business director Rebecca Tinucci and most or all of the staff involved in operating and maintaining the system, leaving officials at the automaker and Tesla’s suppliers uncertain about the future.
Tesla did not immediately respond to a request for comment.
Musk later told X that the automaker still plans to expand its Supercharger network, but will “slow down on new locations and focus on 100% occupancy and expansion of existing locations.” .
“As a contractor on the Supercharger network, my team woke up this morning to a sharp kick in the pants,” said Andres Pinter, co-CEO of Barrett EV Charging Solutions, a network supplier. Ta.
“Tesla has already received funding under the federal NEVI program,” he said, referring to the National Electric Vehicle Infrastructure Formula program, which provides funding for states to deploy EV charging networks.
“Musk is not going to back down from real money liberalization. He could reassemble the EV Charger team bigger, stronger, and in a more Musk-like way.”
GM and Ford said in separate statements that their plans to equip their EVs with connectors that allow drivers of Chevrolet, Cadillac and Ford-branded EVs to charge at Tesla stations remain unchanged.
GM said, “We have nothing new to announce regarding our plans.” “We continue to monitor the situation regarding changes and potential impacts to the Supercharged team, but we have no further comment or updates at this time.”
“Nothing unexpected.”
Some industry executives and analysts said Mr. Musk could have disbanded the existing Supercharger organization and built a leaner, lower-cost team to run the business.
However, in a call with analysts earlier this month, Musk made it clear that he is focused on opportunities in the areas of artificial intelligence, robotics and autonomous robotaxis.
“There’s nothing wrong with these cuts,” said Dan Ives, an analyst at Wedbush Securities. “Musk is trying to send a signal within the company that the challenges Tesla is facing will force him to make tough decisions. …This shows he is seriously focused on costs.”
Tesla last week reported lower first-quarter profits and its first quarterly revenue decline since 2021. Despite last week’s surge, Tesla stock is down 22% since the beginning of the year.
Analysts say that as Tesla’s EV sales decline and pressure on margins increases, Mr. Musk is cutting back on spending on the Supercharger network to preserve cash for other projects with more growth potential. There is a possibility of reduction.
“Tesla is in a phase of slowing growth, so we’re looking at properly estimating (capex) and operating expenses over the next few years,” Morningstar analyst Seth Goldstein said.
Analysts said more traditional automakers may stick with businesses that promise steady revenue and near-continuous exchange of data with customers. But Musk may take the Silicon Valley entrepreneurial view that charging is a legacy business that could be streamlined or sold.
“Now that the industry has adopted the NACS standard, I suspect he views superchargers more as a cost center than a strategic moat,” said KC Boyce, vice president at data analytics firm Escalent. Ta.
Analysts said the Tesla Supercharger network could be worth a lot if Musk wants to sell it. Rival U.S. charging networks have been plagued by reliability issues and don’t have the scale or prime locations that Tesla has secured.
Seven major automakers, including Mercedes, GM, Stellantis, Honda, BMW and Hyundai-Kia, formed a joint venture called Iona last year to develop a fast-charging network to compete with Tesla’s Supercharger network.
