Tesla’s Supercharger Strategy Starts a Winning Streak
Tesla’s new supercharger strategy allows the company to monetize its competitors’ customers by collecting charging fees from them. (Prices vary by region, time of day, and whether an EV is made by Tesla, but charging a car generally costs between $10 and $30.) And if more automakers choose to follow Ford and GM, Using Tesla’s plug standards, it could future-proof Tesla vehicles by always ensuring owners easy access to public charging stations. “Tesla’s walled garden thing was great in the short term, but over the long term it was a losing strategy,” said Tom Narayan, automotive research analyst at RBC Capital Markets.
In this way, Tesla is a little like Apple when it set up its App Store and positioned itself as an intermediary between app developers and their own customers, says Daniel Schlagwein, an economics professor at the University of Sydney written on the Tesla strategy. More electric vehicle owners will likely need to turn to Tesla to keep their cars moving. “Conceptually, the automotive industry was a competition to sell cars — thinking of it as a competition to power those cars is a whole new way of looking at it,” he says.
A potential downside to Tesla’s reinvigorated charging strategy is that its customers will need to share Supercharger management with other EV drivers. Some early adopters are already feeling pressure from the company to use the network less.
For years, the electric car maker offered buyers of Model S sedans and Model
In offers emailed to customers, the company suggested trading the free juice perk for a $3,000 rebate on a new car and three years of Supercharger, then upped the rebate to $5,000. Through the end of this month, Tesla is offering anyone willing to sell their old S or
No deal, says Kagai Kinyua, a Model S owner who lives between Maryland and Georgia. He doesn’t charge at home because he wasn’t allowed to install a personal charging station in the multi-storey car park of his high-rise building. Therefore, Kinyua charges the majority of its charging sessions at local Tesla fast charging stations. He estimates the perk saves him nearly $3,000 a year.
Tesla’s attempts to lure customers into giving up free charging for life has left drivers confused about the company’s rationale or strategy. “I guess they realize that old owners are holding on to their old cars,” says Kinyua.
Or maybe Tesla fell into a trap that caught other tech companies offering perks like unlimited phone minutes or cloud storage to lure first-time users, then realizing it was a shame to give it away for free. Musk said so back in 2018, stating that unlimited, free charging “isn’t really sustainable when mass-produced and doesn’t incentivize optimal behavior.” He concluded, “We probably should have ended this sooner.”
Tesla’s recent moves to expand the power of its charging network suggest another motive for ending unlimited free charging: The automaker is trying to clear charging stations to make room for droves of paying customers. Tesla, which reportedly disbanded its press team in 2021, did not respond to a request for comment.
Vicente Perez, owner of a 2014 Model S, says he only uses the Supercharger network on road trips or when the battery is dead when he’s far from his home in Los Angeles. But he’s not going to give up his unlimited free Supercharger easily, or the car the perk is tied to. “We still plan to keep it until the wheels fall off,” he says.
