Tesla Supercharger network in Ireland

Nuanced BS is still BS.

Might be ahead of a planned sale of the business. Cutting people costs to make a business attractive is common enough.

This article puts forward some reasons why that might make sense.

Again, nobody seems to be addressing the question as to whether it's profitable or not. Not even asking the question in a lot of cases.

It's so cute that they think that $.40/kWh comes at no cost. Never mind the capital cost of said superchargers, their installation and the factories that make them.

They have to pay for the electricity. That's the cost. But no mention of this from the geniuses at Bloomberg.

The article did estimate the current revenue, not profit. But it did project what the network could have generated in profit in the future.

Anyway, this latest twist in the plot of one particular tech company have finally made me admit that having such an unstable leader is not good for anybody. Large companies and their customers need a less impulsive and more rational leader making major strategic decisions.

But again that's supposition. Having the aim of breaking even doesn't make it so. And opening up the network to other makes suggests an attempt to meet that aim another way considering the trade off is a possible loss of car sales because exclusivity is gone.

They also announced a target of doubling the number of SuCs by the end of this year (from 40k to 80k). But as of now, they've only reached 55k, putting that target in doubt before the slow down/halt was announced.

I know that trying to rationalise Musk's mercurial actions is a fool's game, but nevertheless it seems to me that the only rational explanation is that it was a massive cash flow hole and the expansion coupled with the slowdown in car sales made it unviable to continue expansion.

People in the electricity industry have reported that emails to ascertain the status of ongoing installations are bouncing. It's completely nuts.

Yes, I don't get it at all. It looks like deliberate sabotage, or an childish impulse decision because somebody in the SuC team dared to voice their concerns.

That would be a strong possibility too. And opening it up to other manufacturers could be designed to add value to it. But they announced that last February along with the planned expansion to 80k chargers which would seem like a long term plan. Surprising that there was no leak of this in the interim if that were the case.

I don't think we'll ever know how profitable the network is or isn't, but it should be possible to get an idea from the competition

If you look at Electrify America and Ionity, they aren't reporting any profits that I can see and their revenue for 2023 seems below the announced investments

Now I'm aware that those networks have different costs to Tesla, it's been shown for example that Superchargers can be installed for a dramatically lower cost than some of the competitors

However, Tesla also charge their customers less than the competition, so their profit per kilowatt-hour is likely the same or less than other networks

Also, Tesla's expansion of the network has generally been a lot grander that other networks. That's great for drivers but it does require a lot of money up front and also means you've a bigger network to support

I also wonder what the utilisation rates are like overall. There's a lot of busy sites, but there's a lot of quiet ones as well that probably struggle to pay for themselves

Lastly, it's possible the rush to expand has led to some suboptimal leases being signed with property owners. This could be the cause of some of the NY sites getting cancelled

Overall, I don't believe the network was bleeding money as some people have said, but I can't see it as a hugely profitable enterprise either. My suspicion is that it broke even at best and possibly ran at a small loss that Tesla was willing to absorb until now

On a related note, Ionity and Fastned have recently started opening their own shops at charging hubs. Elon also showed plans to build a supercharger diner site in LA at some point

There's a lot of reasons why you might want to do that, but one might be that the services around the chargers are more profitable and the CPOs are tired or sharing the profits

I've heard it said that a petrol station makes as much profit from a cup of coffee as a 50l diesel sale. It's quite possible the same applies to charging

Ah I didn't realise it was just the US team being let go. That makes the actions even stranger but Musk is a strange man. Space X is known for consistently testing to destruction, and then fine tuning to get it to work. Neuralink has allegedly used more chimps than they were meant to.

Your example of twitter is a fair one but that was already an employee-heavy company when he bought it. Tesla was built from the ground up. Again, it makes the decision even stranger again

Tesla was built from the ground up, and a lot of that happened before musk bought his way in.

The US supercharger network was free to access until about 2018. In 2022 it became open to other EVs with the magicdock solution, this year some EVs will get adapters for the network and next year NACS will become the default US standard. At which point they will also get federal and state funding for building out the network

So my thinking is

Loss making - 2012-2018

Breaking even - 2018-2022

Profitable 2022-2024

More profitable 2024-2025

Much more profitable 2025+

Makes the letting go of staff this year seem very strange indeed

That's really interesting. Thanks for that.