Analysis: Tesla's EV charging team layoffs threaten to slow Biden's program to electrify highways

Evgo

10/05/2024 19:15

(Adds Musk post in paragraph 13; adds Supercharger graphic)
    By Abhirup Roy
       SAN FRANCISCO, May 10 (Reuters) - Elon Musk's decision
to gut Tesla's electric-vehicle charging team is scrambling
plans for rolling out new fast-charging stations and may delay
President Joe Biden's efforts to electrify U.S. highways.
    Last year, the Biden administration announced rules for an
ambitious plan to expand the country's charging infrastructure
and jump-start EV adoption. Under the National Electric Vehicle
Infrastructure (NEVI) program, the government is doling out $5
billion to states over five years to build 500,000 EV chargers.
    EV market leader Tesla, which also operates the largest
network of fast chargers - called Superchargers - in the U.S.
and is the biggest winner so far of those federal funds, was
seen as a crucial part of that plan.
    Since news of Tesla's abrupt EV charging layoffs surfaced,
however, executives at charging companies say they have been
receiving phone calls from landlords looking for a new partner
for their private charging projects after Tesla pulled out.
    Now, the charging companies are preparing for Tesla to pull
out of the federal program. That, they say, could throw a new
wrench into an already-slow rollout.
    "It's going to delay NEVI rollout. There's no question about
it," said Aatish Patel, co-founder of XCharge North America,
which makes EV chargers for fleets and charging station
operators. 
    If Tesla backs out, then the solicitation by states for
NEVI-funded charging projects starts over, he told Reuters. "A
lot of these sites aren't going to get built this year, or
within the time frames that were initially dictated."
    Patel said real estate companies representing about 10
non-NEVI sites in Texas, Louisiana and New York had called since
news of the layoffs, saying that Tesla was pulling out and they
were looking for a replacement.
    Tesla has won awards to build chargers for 69 of the 501
NEVI-funded sites announced so far, according to San
Francisco-based research firm EVAdoption. 
    "I'm speaking to any NEVI sites they've been awarded.
They're not going to move forward on those," Brendan Jones, CEO
of Blink Charging  BLNK.O , told Reuters. Blink has received
three inquiries in two states about multiple private sites where
Tesla had backed out of since the layoffs, he said. 
    Rollout of the federal program has been already sluggish.
Long-awaited rules on eligibility for federal funds were finally
laid out early last year. Only a handful of federally funded
charging stations have been opened up for the public.    
         
    PULLING THE PLUG
    Since the layoffs, Musk in a posting on his social media
platform X said Tesla plans "to grow the Supercharger network,
just at a slower pace for new locations and more focus on 100%
uptime and expansion of existing locations." 
    He did not respond to questions from Reuters on the
implications of his decision. In a subsequent post on Friday,
Musk said Tesla will spend more than $500 million to expand its
fast-charging network this year. 
    A spokesperson for the federal Joint Office of Energy and
Transportation, which oversees the NEVI program, said in an
email it does not expect individual business decisions to impact
EV charging projects funded by the government.
    States that awarded Tesla NEVI sites are closely monitoring
the situation.
    Colorado will adjust its program as needed, said Kay Kelly,
chief of innovative mobility for the Colorado Department of
Transportation. Texas - the biggest beneficiary of NEVI funds -
said it does not anticipate any impact from Tesla's layoffs.
    Tesla's change of plans, however, will affect the entire EV
industry. Almost all automakers decided last year to adopt
Tesla's North American Charging Standard (NACS) for their
vehicles from next year. That could provide a silver lining for
other charging startups - and recently laid-off Tesla
employees. 
    "There will be a lot more NEVI sites available if Tesla
backs out of projects they have already won, or withdraw their
applications," Rick Wilmer, CEO of charging company ChargePoint
 CHPT.N , told Reuters. "It will be an opportunity for others to
jump in and fill that void."
    Rivals like EVgo  EVGO.O  are looking to hire those let go
by Musk. "If you were impacted by the recent Tesla layoffs, we
invite you to explore EVgo's diverse range of job openings," a
talent acquisition manager at the charging company said in a
post on LinkedIn.
     

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Musk disbands Tesla EV charging team, leaving customers in the
dark     ID:nL1N3H33WR 
Tesla's Superchargers in the United States    https://reut.rs/3TTnBDF
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Abhirup Roy in San Francisco
Additional reporting by Jarrett Renshaw in Philadelphia
Editing by Peter Henderson, Matthew Lewis and Diane Craft)
 ((mailto:abhirup.roy@thomsonreuters.com; +1 415 941 8665;
@abhiruproy30;))