Tesla laying off the Supercharger team

This sounds nuts:

2 Likes

It looks like to me he is going all in on FSD and the robo taxi.

Andy

If that is true, and if it is also true the entire team (or even a large chunk) is being laid off that seriously changes my calculus on waiting for my preferred EV to get a native NACS port instead of CCS.

1 Like

I don’t see how the two are in any way connected. Its not as if Tesla will take the savings from this team (if any) and deploy those funds on FSD.

From the above link (which is a decidedly pro-Telsa website):

Electrek’s Take

Firstly – it makes absolutely no sense to lay off the Supercharger team. Supercharging is an incredible opportunity for Tesla, especially now that everyone else has adopted NACS.

Tesla has a fairly simple business case from here on out to become the leading “gas station of the future.” With its experience and lead on Superchargers, its more reliable and better-designed stations, and its existing business footprint with so many stations installed around the globe, the company has a natural lead. This business case is even stronger now that the entire industry is behind NACS.

To lay off that whole team just when the company has earned such a big win, when billions in public money is available for buildout (which would not have been available without industry NACS adoption, which was, again, spearheaded by Tinucci’s negotiations), and when there is a lead to be maintained, is absolutely crazy. This move, alone, would erode any confidence I had left in Tesla’s CEO – if I still had any.

Hawkwin
Who thinks Musk just likes to fire people - like he did with Twitter, before bringing some of them back.

8 Likes

Maybe it’s just a matter of corporate focus?

One thing that’s true of Musk is that he likes to take big risks in solving huge problems. You know, making electric cars a real thing or developing re-usable spacecraft. Incremental improvement and deployment of already-solved technologies might not be his vision. So while there might be riches for the company that deploys a competent supercharger network, that’s already a solved problem - and Musk isn’t in the business of managing solved problems.

*(either that, or it’s because he’s no longer interested in any line of business that doesn’t have a meaningful application on Mars. So solar and tunneling companies can stay on his plate, but growing the supercharger network or bringing a compact sedan to market is out. AI and autonomy are useful for Mars, so they stay.)

2 Likes

Then by extension, he should get rid of the cybertruck and whatever the semi is called. Certainly those lines of business are a bigger distraction and in direct competition for corporate resources (both human and capital) that could otherwise be used for the robotaxi.

Robotaxis will need a charging network, especially in China (where there are less superchargers than in the USA), Robotaxis don’t need a cybertruck.

1 Like

Yes, but my WAG is that Musk is motivated by/views Tesla as a vehicle for solving problems, and not implementing solutions to problems that have been solved. That’s not limited to just FSD and Robotaxi.

Charging’s been “solved” - you could take all of Tesla’s IP and license it to a third party and they could competently build out a bunch of chargers. Arguably we’ve reached the point (globally) where electric passenger sedans and SUV’s have been “solved” - we’re well beyond 2010, and there’s literally scores of different models in volume production.

But pickup trucks and semi-trailers/long-haul trucking have not yet been solved. Sure, pickup trucks a leeeetle bit - but the CT seems a labor of love for Musk. And Semi is actually perhaps as compelling a use case for autonomy as a passenger taxi.

1 Like

I would think drayage would be an excellent application for a semi EV. Distances are typically short. They do lots of stop and go, need lots of torque, and spend lots of time idling.

As I think about it, can I offer a contrary take? That this is actually a pretty smart move?

The Supercharger Network was incredibly valuable to Tesla as an amenity to its car sales - something that differentiated their product from competitors. Tesla cars had the best charging experience, which drove demand for Teslas. AIUI, Tesla captured the economic benefit of their superior charging network through vehicle sales - not exclusively (or even primarily) through charging for the network.

And now that’s…gone? Right? Tesla opened up the network to rival EV’s, and so that benefit which used to be exclusive to Tesla owners isn’t a brand-specific benefit any more. That portion of the value of the Supercharger Network - the premium to Tesla - has disappeared. Tesla traded it away as part of last year’s subsidy negotiations with the Administration.

So while Supercharging used to be a huge asset for Tesla, is that true any more? Improvements or expansions to the network don’t accrue to Tesla alone any more - every EV benefits from it. The Federal government is about to spend $7.5 billion subsidizing stations all over the country, and the entire purpose of that is to get to the point where chargers aren’t unique or special, but just commoditized infrastructure.

Why would Tesla want to still be in the business of chargers any more? Once they’re no longer exclusive, is there really a business case for investing in that program much more?

5 Likes

Well somebody will, certainly, perhaps several somebodies. There is a business there, to be sure, although it’s not likely to be a moonshot business, which is all Musk seems to care about.

[As a sidebar I would note that AWS and Shell Oil happened by accident out of a business almost wholly unrelated to what they do now. AWS, of course, provides cloud services and took 10 years of gestation from Amazon and another 10 to grow to a world class business today. Shell began, and a lot of people don’t know this, as a company which imported sea shells from the Far East. Sea shells (all the rage in 19th century London), then other imports, then tankers, and then … oil. Like a box of chocolates: you never know what you’re going to get.]

So it may be that the charging business won’t be anything to speak of, but having built out the pre-eminent charging network in the country fast - and without bankrupting the mother ship - there’s a lot of institutional knowledge that Musk just cut loose. If he’s selling it I would think the buyers would want those people intact. If he’s not selling it then …. What? That’s a lot of money to leave on the table, and a stranded business to boot. This looks reckless, but perhaps some sort of plan will make it make sense in the coming days and weeks.

I agree that the charging network was the hidden crown jewel which allowed people to have some surety when buying a Tesla, that’s why I couldn’t understand why he so blithely gave away the rights to it, apparently without even realizing the profit that might have been earned from it. In hindsight this too looks erratic, but maybe it’s just me and the lens I’m using to look at the business.

And if this is just a cost cutting move, well it doesn’t cut much, it doesn’t save much, and it potentially engenders a lot of ill will if the network reliability is degraded to any degree whatsoever.

“Pretty smart move”? I’ll wait and see.

4 Likes

Only thing I can think of is that the superchargers are useless for robotaxis. Because they need to be able to charge themselves somehow, not have some human plug them in, monitor them, and unplug them when done. So if he’s “all in” on robotaxi, then he needs a new charging mechanism that the vehicle can do by itself. Of course, in my opinion, if he’s all in on robotaxi, to the exclusion of everything else, then he’s nuts. On the other hand, nuts have accomplished great things in the past, so who knows?

It could also be something much more prosaic. Maybe he thinks the supercharger team has become complacent and bloated and he wants to start them fresh with new people. I think he did that once or twice with large segments of the SpaceX team.

How much of this is simply a way to bump up TSLA’s price? The market loves it when a CEO lays off workers.

My speculation

a) CATL batteries coming soon that give 620 miles range and charges in 15 mins. No need for many superchargers.

b) Battery efficiency will keep going up. Powerwall at home + Charging.

c) Tesla using partners (Exxon or BP ?) to do the buildout. Tesla licenses tech e.g. Google/Android.

d) Robotaxi , AI Inference, Optimus is the future. Superchargers are low margin , asset heavy

7 Likes

That would be very forward thinking and I think you might be right.

Andy

Very good points on (a) and (b). Tesla has all the telemetry to know exactly what share of owners ever attempt drives of X, Y or Z miles in an 8-12 hour perod. If the firm is confident battery range will rise to be within that upper daily miles driven limit of Z miles for 90 plus percent of drivers, the value of ultra fast intra-day charging drops precipitously.

Still, the ecosystem does require significant buildout for hotels and similar mass lodging / entertainment venues that typically lie at the end of a long drive. It would have made more economic sense to spin off the team as a distinct entity and capture the value of it operating as a going concern. Even if Musk thinks the demand for intraday supercharging will collapse, he still might have suckered someone else into buying it at a premium.

WTH

4 Likes

But the tradeoff is cost versus range. Always. Even when battery technology improves, it’ll still be cost versus range. Let’s say a typical 82kWh battery costs them $8000 today, and a new technology comes out such that an 82kWh battery only costs $4000 and has half the weight, they won’t install a 164kWh battery for $8000 and double the range, they will instead take the $4000 cost savings and reduce the price and/or improve margin.

The need for supercharging will still exist. Now, it is true that if the technology improves enough such that supercharging can be done at a sustained 800kW with less tapering than today, then perhaps that 82kWh battery can perhaps go from 10% to 80-90% in under 10 minutes, then there will be less usage of those extra-fast superchargers, but they will stil be used, and they will still need to exist at the same relative distances from each other. Of course, sustained 800kW will require not only new battery technology, but also new, much heftier, chargers, with thicker cables and higher voltages, and higher currents. Even 800V would require 1000A to achieve 800kW charging, and 1000A creates a lot of heat in the cable. There are a whole host of technologies that will have to change to support that. Probably even including vehicles that charge at well over 1000V (to reduce the current necessary).

1 Like

My understanding is that it came out of negotiations with the Biden Administration over eligibility for all the subsidy money for EV charger buildout. IOW, the Administration de facto forced Tesla to open up their charging stations in order to avoid being shut out of the program. So in order to avoid that, and avoid being on the other side of a standards war with the government (as happened in Europe), Tesla acceded. A tough choice for Tesla - and even though there’s an argument to be made that they should have refused the deal, it wasn’t a boneheaded move to take it instead.

But once they took it, the Supercharging team doesn’t have nearly as much value to the company. And as pointed out by others, if Tesla genuinely anticipates that autonomy or extra long range batteries are coming soon, even that value will be falling quickly.

3 Likes

Possibly, but on the flip side of that it takes longer to charge.

Regardless, it seems to me low charging is a low margin business. More of an amenity than a profit center. I also have to think Elon has been consolidating power recently.

1 Like

It gives multiple competitors the opportunity to hire the people they need to design and build a charging network of their own. For what purpose? We will find out when it happens.

It gets worse:

:smiley:

satire off

5 Likes