Tesla's charging standard dominates the European and American markets, what will Musk do next?

Being able to let competitors take the initiative to "surrender" without bloodshed, and with one's own strength, the standards set by the government have become "decorations." In the European and American markets, Tesla charging network is staged such a scene.

Ford is the first automaker to partner with Tesla's charging network. In early June, Ford Motor announced that starting in 2024, its electric vehicles will use more than 12,000 Tesla super charging piles in the United States and Canada, and install Tesla's North American standard charging ports on future electric vehicles. (NACS).

When the lid was lifted, the European and American auto industries encountered a "Tesla moment".

In the past week, first General Motors and Volvo entered the "circle of friends" of Tesla's charging network, and even Volkswagen and Hyundai responded that they were evaluating the feasibility of joining Tesla's charging network. Not only are a lot of car companies flocking, but mainstream charging operators in North America have also "turned their backs" on the NACS charging standard and stood together with Tesla.

So the question is, after the Tesla charging network dominates Europe and the United States, what does Musk want to do next?

From North America to Europe, it's getting harder to reject Tesla's NACS charging standard

On July 3, 2023, the stock price of Tesla (TSLA.US) rose 6.9%, closing at US$279.82 per share, and its market value soared US$56 billion (about 210 billion yuan) overnight. Since the end of May, Tesla's market value has risen by about 300 billion US dollars (about 2.16 trillion yuan), and the biggest factor driving its skyrocketing market value comes from Tesla's charging network.

In the past few days, European and American car companies have collectively chosen to stand in line with Tesla.

For an electric vehicle charging standard, the larger the number of supported vehicles, the more pronounced the siphon effect. Ford Motor's sales in 2022 will be 3.67 million, and General Motors' sales will be 5.84 million, which are 2.8 times and 4.5 times that of Tesla's electric vehicle sales, respectively. Together, the three together account for 70% of U.S. electric vehicle sales.

The two North American auto giants fell to the Tesla camp, which suddenly changed the direction of the wind.

Even the auto industry association and US states are behind it . The International Society of Automotive Engineers (SAE) recently stated that the goal is to make the Tesla charging connector an industry standard configuration in 6 months or less, which will make it easier for operators of electric vehicle charging stations to adopt the port. Texas and Kentucky require car companies and charging service providers to adopt both Tesla's NACS standard and the government's CCS standard, and Washington, California, Iowa and Michigan quickly followed suit.

Europe, which was not "cold" with Tesla's NACS charging standard before, can't sit still.

On June 28, Swedish automaker Volvo announced its support for the Tesla Electric Vehicle Charging Standard (NACS), and has signed an agreement with Tesla. Starting next year, Volvo electric car owners will be able to use Tesla's 12,000 charging stations in North America. Supercharged piles, and began to be equipped with Tesla plugs, becoming the first car manufacturer in Europe to connect. On June 30, the Swedish electric vehicle company Polestar announced its entry into the market.

More European car companies were coerced and had to join in. The reason is simple. When electric vehicles of mainstream brands all support this charging interface standard and charging stations are updated, if they don’t join, they will be isolated and their electric vehicles will be less attractive to consumers.

Italy's Stellantis Group sold 6.34 million vehicles last year, ranking fifth in the world. It owns two major brands, Peugeot Citroen and Fiat Chrysler, and its business spans Europe and the United States. The Stellantis group is also starting to consider using Tesla's charging standard.

Regarding the concerted action of its peers, Volkswagen also responded that it is negotiating with Tesla on the adoption of the North American Charging Standard (NACS) technology. At present, Volkswagen’s charging network department Electrify America has agreed to use the system. It is quite interesting that the CCS standard that is being rolled over by Tesla was created by Volkswagen and Hyundai.

If nothing else, Volkswagen, Hyundai, Renault, BMW Group, and Mercedes-Benz will all be forced to bind to the Tesla NACS charging standard, because it becomes harder and harder to refuse.

Some people wonder why European and American auto giants that have been around the world for decades, even in today’s era of electrification, the sales of any one of them are several times higher than Tesla’s. Why would they choose to compete with their competitor Tesla? together?

Obviously, they were not influenced by Musk's personal charm, but they were too incompetent in the fast charging service and experience of electric vehicles.

This starts with the five global charging standards for electric vehicles.

The world's top five charging standards

At present, there are mainly five charging interface standards in the world. North America adopts the CCS1 standard, Europe adopts the CCS2 standard, and China adopts its own GB/T standard. Japan has always been a maverick and has its own CHAdeMO standard. However, Tesla developed electric vehicles earlier and had a large number of them. It designed a dedicated NACS standard charging interface from the very beginning.

The CCS1 charging standard in North America is mainly used in the United States and Canada, with a maximum AC voltage of 240V AC and a maximum current of 80A AC; a maximum DC voltage of 1000V DC and a maximum current of 400A DC.

However, although most car companies in North America are forced to adopt the CCS1 standard, in terms of the number of fast charging superchargers and the charging experience, CCS1 is seriously behind Tesla NACS, which accounts for 60% of the fast charging in the United States. market share. It was followed by Electrify America, which is owned by Volkswagen, with 12.7 percent, and EVgo was third with 8.4 percent.

According to data released by the U.S. Department of Energy, on June 21, 2023, there will be 5,240 CCS1 charging stations and 1,803 Tesla super charging stations in the United States. However, Tesla has as many as 19,463 charging piles, surpassing the U.S. The sum of CHAdeMO (6993 roots) and CCS1 (10471 roots). At present, Tesla has 5,000 super charging stations and more than 45,000 charging piles worldwide, and there are more than 10,000 charging piles in the Chinese market.

As charging piles and charging service companies join forces to support the Tesla NACS standard, the number of charging piles covered is becoming more and more. ChargePoint and Blink in the United States, Wallbox NV in Spain, and Tritium, a manufacturer of electric vehicle charging equipment in Australia, have announced support for the NACS charging standard. Electrify America, which ranks second in the United States, has also agreed to join the NACS program. It has more than 850 charging stations and about 4,000 fast charging chargers in the United States and Canada.

In addition to the superiority in quantity, car companies "rely on" Tesla's NACS standard, often because of a better experience than CCS1.

The charging plug of Tesla NACS is smaller in size, lighter in weight, and more friendly to the disabled and women. More importantly, the charging speed of NACS is twice that of CCS1, and the energy replenishment efficiency is higher. This is the most concentrated issue among European and American electric vehicle users.

Compared with the North American market, the European CCS2 standard belongs to the same line as the American standard CCS1. It is a standard jointly launched by the Society of Automotive Engineers (SAE), the European Automobile Manufacturers Association (ACEA) and the eight major automakers in Germany and the United States. As mainstream European car companies such as Volkswagen, Volvo, and Stellantis tend to use the NACS charging standard, the European standard CCS2 is having a hard time.

This means that the combined charging system (CCS) standard prevailing in the European and American markets may be quickly marginalized, and Tesla NACS is expected to replace it and become the de facto industry standard.

Although major car companies claim to continue to support the CCS charging standard, it is only to obtain government subsidies for the construction of electric vehicles and charging piles . For example, the U.S. federal government stipulates that only electric vehicles and charging piles that support the CCS1 standard can get a share of the $7.5 billion government subsidy, even Tesla is no exception.

Although Toyota sells more than 10 million vehicles annually, the status of the CHAdeMO charging standard dominated by Japan is quite embarrassing.

Japan is keen to establish standards globally, so it established the CHAdeMO interface standard for electric vehicle charging very early. It was jointly launched by five Japanese automakers and began to be promoted globally in 2010. However, Japan's Toyota, Honda and other car companies have huge power in fuel vehicles and hybrid vehicles, and they have always moved slowly in the electric vehicle market and lack the right to speak. As a result, this standard has not been widely adopted, and it is only used in a small range in Japan, Northern Europe, and the United States. , South Korea, will gradually decline in the future.

China's electric vehicles are huge, with annual sales accounting for more than 60% of the world's share. Even without considering the scale of overseas exports, the large market for internal circulation is enough to support a unified charging standard. However, China's electric vehicles are going global, and the export volume is expected to exceed one million in 2023. It is impossible to live behind closed doors.

Therefore, how China's GB/T charging standard will go global, occupy a place in the world, and help the export of electric vehicles is a problem to be solved.

As early as November 2021, Tesla opened charging piles in France, Norway, the Netherlands and other European countries, and gradually expanded to the United Kingdom, Spain and other countries. In April of this year, Tesla opened up its charging network on a trial basis in China, and the first batch of 10 super charging stations were opened as pilots.

The immediate benefit of an open charging network is additional revenue.

Morgan Stanley predicts that assuming that the penetration rate of electric vehicles reaches 30% in 2030, Tesla's charging station share reaches 80%, and the profit margin of charging station business reaches 70%, Tesla's charging business valuation will exceed 100 billion US dollars . According to investment bank Piper Sandler & Co, by 2030, Tesla will increase its revenue by about $3 billion a year by charging other manufacturers' electric vehicles.

However, it is only the first step to increase the utilization rate of Tesla’s charging network, dilute the construction and maintenance costs of charging facilities, and create huge charging service revenue.

In fact, Tesla's supercharging network is only a big lead in Europe and the United States. If it is placed in today's China, whether it is a high-voltage fast-charging electric vehicle or the laying of super charging piles with a power of 250KW or more, Tesla's advantages Not obvious. But the difference is that Tesla's promotion of charging standards and the opening of charging networks to peer electric vehicles are Xiang Zhuang's sword dance, intended for Pei Gong.

For car companies , the supercharging network is a moat and a trump card to attract users to buy cars, but for Tesla, it will ultimately be an energy management and service company. Electric vehicles and charging networks are only the gateway to sustainable energy. The tool relied on on the road to development, the coordinated development of solar storage and charging is the path to realization. Distributed photovoltaic SolarCity, household Powerwall, large storage Megapack, heat pump, etc. can be highly coupled with electric vehicles and charging networks to benefit from flexible energy scheduling and sustainable development.

Therefore, in addition to its own territory, Tesla must also "unite" other electric vehicle manufacturers and charging stations to make the "pool" of electric vehicles that can be mobilized large enough. Unifying the charging interface is a key move.

The charging interface may seem inconspicuous, but it is the key to energy input and output. It is related to the OBC and battery of electric vehicles, and can also be extended to energy storage and other industrial chains, involving energy efficiency conversion and improvement.

In the European and American markets, Tesla's electric vehicle sales dominate the list, and its photovoltaic, energy storage and other businesses are growing rapidly, and a trend of dominance is gradually emerging. But in China, Tesla’s path may not be easy. Around the core scene of electric vehicles and charging services, energy chain smart power , telephony, etc. are also laying out around optical storage charging , V2G, and virtual power plants, and there are many energy giants eyeing them.

But for Tesla, it is enough to rely on China's mature new energy supply chain system to help it go global.