Putting aside your feelings about Elon Musk (and what has become of Twitter), his company, Tesla is frankly… killing it.
Tesla’s electric vehicle charging and holistic energy strategy is finally paying off, and it’s undeniable that the EV giant’s recently struck deal with Ford will change the conversation around EV range anxiety drastically, and for the better.
On top of playing a vital role in national charging infrastructure, the EV-maker is also making strides in the EV battery business, has shares and renewables’ revenue through the roof, and is getting a solid footing in lithium refining. But first, let’s dig into this deal with Ford.
Starting early next year, owners of Ford’s EVs will be able to fast-charge using Tesla’s Supercharger network, a matrix of 12,000 Superchargers which blows Ford’s “BlueOval Charge Network” out of the water.
While the BlueOval network, boasts itself as the “largest public charging network for electric vehicles in North America*” the little asterisk by that claim leaves out private charging networks like Tesla’s. With the new deal, the amount of chargers Ford EV drivers gain access to more than doubles the previous capacity.
Tesla’s part in building out charging infrastructure in the United States has been a long time coming.
Back in February, the White House announced that for the first time, thousands of Tesla’s Superchargers would be available to anybody driving a battery-powered car, adding on to the only 130,000 public EV chargers scattered around the country, as of earlier this year.
For comparison, there are 1.8 million EV charging stations in China, the country with the biggest EV industry in the world, with 44% of all EVs, with the U.S. represengting 17% of the world’s stock per the most recent Pew research.
Europe, which currently leads in EV sales, has 31% of global EVs. The charging network also drives laps around that of America, with over 479,000 public charging points in European Union in 2022, and an additional over 42,000 in the United Kingdom.
That’s why, following the February announcement, the Biden administration, National Charging Experience Consortium (or ChargeX), an industry-wide coalition featuring Tesla, Ford, and other big names like General Motors and Electrify America, to address the lack of charging infracture in the US and how the auto industry could bolster it.
While the consortium is voluntary, the administration set a deadline to find a solution within the next two years.
As reported by Umar Shakir over at Verge, consortium’s director, John Smart, the national labs have the ultimate goal that “all EV drivers of any vehicle can charge on any charging equipment,” specifically ones that are federally funded. Plus, on a Twitter Space announcing the deal with Ford, Musk hinted that Tesla wanted to be even “more helpful” to standardizing tech in the EV world, becoming like a universal “Android” charger.
Tesla's Superchargers could become the standard for EV charging in the US, Jim Farley, CEO of Ford, told CNBC, but added the caveat: “With adapters and software, we really don't have to make a choice right now what the standard is, but I think it's going to play out in the free market.”
With the deal, Ford shares were up 7.6% at $12.25 in afternoon trade, while Tesla shares rose 7.5% to $197.95, which is still impressive, despite Tesla no longer riding its high of November 2021 when the news of an agreement to sell 100,000 EVs to Hertz — the first nationwide car rental company to offer Teslas — propelled a one-day-only moment of $1,025 a share.
In its largest-ever vehicle purchase, the cars were bought for the sum of about $4.2 billion, skyrocketing Tesla's value to $1 trillion, setting both a purchase agreement record, and the biggest 12-day gain in capital market history.
According to Mark Fields, Hertz’s interim CEO at the time, “Tesla is the only manufacturer that can produce EVs at scale” to “democratize access to electric vehicles,” a “very important part” of the car rental company’s strategy.
In addition to outright crushing it in terms of helping build out charging infrastructure, Tesla’s Model Y most recently became the world’s best-selling car… period. While the EV giant doesn’t provide an exact breakdown of sales, it reported that over 400,000 Model Y and Model 3 vehicles had been delivered to customers in the first quarter of 2023.
In just one year, the Model Y is up from #6 in America, allowing national sales to catch up with California, where it has long been the best selling car, as well as Europe.
However, even though its EV’s are clearly doing extremely well, Tesla is outselling itself with its batteries.
As Canary Media reported last month, Tesla’s battery-storage deployments surged 360%, with solar power revenue on the up and up as well, following the EV maker’s grand-opening of a factory for grid-scale batteries. According to an April quarterly report, Tesla made $1.53 billion in combined solar and storage revenue, with utility-scale storage likely accounting for a large portion of that revenue, though Tesla has yet to confirm.
In quarter one alone, Tesla shipped 3.9 gigawatt-hours of battery packs which is enough to power nearly three million homes or over 300 commercial buildings, showing a clear trend that the EV-maker is poising itself to also become a leader in battery-storage, innovation necessary to store power from solar, wind, and other intermittent renewable energy sources.
The quick pace of its deployment is even more remarkable, when its batter-storage business was basically nonexistent six years ago, with combined storage and solar accounting for 6.6% of its business today.
With both the rising storage and EV demand, lithium, the material necessary for the energy transition to happen, is more crucial than ever.
Musk has made clear that getting into the lithium refining business isn’t his dream — on the earnings call he joked “Can other people please do this work? That would be great. We’re begging you. We don’t want to do it. Can someone please? Like instead of making a picture-sharing app?” Despite his remarks, Tesla is diving in head first into the business, instead of just dipping a toe.
A few weeks ago, Tesla broke ground on its in-house lithium $375 million refinery facility located near Corpus Christi, Texas, which once complete represents a $1 billion investment in the area, Tesla says. The refinery is the first of its kind from a US automaker.
In addition to refining lithium, the company also expects the facility to also process other intermediate lithium feedstocks, including recycled batteries and manufacturing scrap.
Grist as a great piece on what this means for lithium availability in the US, as well as the environmental and social impacts of the new plant and others that will come with the EV transition, but the bottom line is that Tesla is poising itself to play a huge role in America’s passage to clean energy, from not only its pioneering product of electric vehicles, but also to charging infrastructure, renewables, storage, and now, lithium.
These moves also put pressure on other authomakers to follow suit, and make sure that they aren’t left in the dust in a future where EVs are more available, accessible, and affordable than gas cars.
As Musk said in the Twitter space announcing the Ford deal, “Working with Ford, and perhaps others, can make it (the Tesla Supercharger) the North American standard, I think that consumers will be all better for it.”