I couldn’t get the fable of the scorpion and the frog out of my head this morning as I contemplated what it means that Tesla has decided it maybe it isn’t going to expand its Supercharging network as much as it once promised it would. This seems bad for everyone, including Tesla owners, but maybe more so for the other automakers who decided to switch to Tesla’s charging standard.
The first big automaker to switch to the standard was Ford, and it’s maybe wishing more of its cars were EVs given that it’s facing more scrutiny from the National Highway Traffic Safety Administration, which is not super pleased about Ford’s supposed fix for its potentially fiery Bronco Sports and Escapes.
In better news, Mazda was able to ride a lower Japanese yen and a global yearning for hybrids to record profits. It’s not making Toyota money, but it’s making money.
And, finally, it’s Friday and I like to end on a high note, so I’m going to share a trailer for a new documentary about Le Mans created by some old friends.
WTF Tesla?
This week is going to be bookended by Tesla-led TMDs, which is something I like to avoid, but they’ve been making more moves than Mario Andretti since announcing a weak (for them) first quarter.
A couple of weeks ago it came out that Tesla was letting go of most of its Supercharging network team, and I made the point that Tesla should just sell (or spinoff) the business. You can go back and read it if you like. If you don’t have the time, here’s the rough idea:
- Tesla’s network was a moat, but if everyone can access it then the moat goes away.
- Tesla seems less interested in being a car company and making steady money, instead, it wants cash to make Moon Lambo money on AI and robots.
- Selling/spinning off could be good timing for Tesla.
Of course, what seems to have happened is that Tesla has just picked the worst possible outcome for everyone. Instead of selling a thing with an incredible edge, the company instead seems to have killed some of the inherent value.
Here are all the reasons why this is terrible, ranked by who gets screwed the most.
Bad: President Joe Biden/Biden Administration
One of the holdups in having robust EV sales is that people are worried there are not going to be enough functional chargers in convenient places if they buy an electric car. This isn’t entirely wrong! One of the reasons everyone went to Tesla’s standard in the first place is that charging networks like VW-created Electrify America were so bad that automakers just gave up hope of it ever working.
The Biden Administration’s goal was to build out 500,000 new EV chargers and, via the National Electric Vehicle Infrastructure (NEVI) program, was planning to give out $5 billion to do it. Guess who was going to get a lot of that money? Tesla.
There was some concern early on that NEVI shouldn’t go to Tesla Superchargers given that they only served Teslas, but automakers solved this problem by announcing a switch to the Tesla NACS charging design.
But what now? Via Reuters:
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.”
I don’t know if you know this, but government programs only give out money very slowly, and this could make the roll-out of more EV chargers even slower. That’s bad.
Bad: Tesla Owners
If you own a Tesla and have enjoyed having to only share chargers with other Teslas you’ve probably not had to wait too long at a Supercharger station unless you’re in a specific market or use it at a specific time. That’s one of the perks, relative to chargers like those from Electrify America (also, Tesla’s uptime for its chargers is higher, which helps with this).
When Tesla started onboarding new automakers, the presumption was that Tesla would have a lot more Superchargers, therefore reducing the total impact on Tesla’s own customers.
That doesn’t seem to be the case anymore. Here’s what Musk said when the news was announced:
Tesla still 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
— Elon Musk (@elonmusk) April 30, 2024
The company already brags about having 99.95% uptime, so I’m not sure how much there’s to be gained by going to 100% uptime (well, it’s a 5 basis point improvement, I guess).
Musk did sort of walk this back a little today:
Just to reiterate: Tesla will spend well over $500M expanding our Supercharger network to create thousands of NEW chargers this year.
That’s just on new sites and expansions, not counting operations costs, which are much higher.
— Elon Musk (@elonmusk) May 10, 2024
That’s hard to square with all the landlords reportedly looking for new charging tenants and firing much of that division. Maybe Musk did a full turnaround or maybe this is just more smoke and mirrors. Who knows?
Bad: Other Automakers
Last year I wrote that it seemed like Tesla had won the charging wars after most automakers agreed to adopt Tesla’s NACS charging standard. This would give brands like Chevy and Ford the opportunity to point out to prospective customers that they can access the Supercharging network.
That’ll still be true, but will the expansion of Superchargers match the demand for them? Again, it’s unclear, but Musk inadvertently just made the access to the network seem that much less appealing.
If I were a CEO at one of those other companies I’d be pretty furious.
Ok, so we know how it’s bad for, but who is it good for?
Good: Other Charging Companies
The charging arm of oil company BP has already told landlords it’s happy to pick up those leases, saying it plans to spend $1 billion on charging the rest of this decade.
Good: Tesla
Congrats, you got everyone to switch over to your standard and it seems that you kinda sucker-punched them.
Again, it’s hard to know with anything Elon-related where the truth lies, but saying Tesla will expand slowly and firing everyone isn’t a good sign.
NHTSA To Ford: Ok, But F’real How Does This Work?
While Ford has said it’s working harder to avoid recalls and quality issues, it’s not there yet. If you own a specific vintage of Ford Bronco Sport or Ford Escape you may have had your vehicle in for a recall to fix an issue related to faulty fuel injectors that could result in a fire.
Here’s how the issue is described by NHTSA:
Failure or malfunction of the subject component resulting in a fuel leak, fuel odor inside and/or outside of the vehicle, accumulation of liquid fuel and/or fuel vapor near ignition sources, and under hood fires.
And here’s the suggested fix, via the AP:
Ford’s remedy for the leaks is to add a drain tube to send the gas away from hot surfaces, and a software update to detect a pressure drop in the fuel injection system. If that happens, the software will disable the high pressure fuel pump, reduce engine power and cut temperatures in the engine compartment. Owners also will get a “seek service” message.
And here’s NHTSA’s response to that fix:
Based on our review of the alleged defect, the resulting consequences, and the recall’s remedy program, ODI believes that the remedy program does not address the root cause of the issue and does not proactively call for the replacement of defective fuel injectors prior to their failure; therefore, ODI has decided to investigate the adequacy and various safety concerns of the remedy program described in NHTSA Recall 24V-187.
Ford has to provide a lot of details to NHTSA to explain why the fix will actually work, prove that it doesn’t just spill gasoline everywhere, and show that it’ll reduce fires.
Mazda’s Raking In That Yen
When Toyota announced its annual results (on a March-to-March fiscal year) it admitted it made more profit than any Japanese public company had ever made before. Some of those profits were because the company makes attractive hybrids efficiently. Some of it was Japanese currency fluctuations.
Do you know who else makes hybrids and exports a crap ton of cars? Mazda!
The company just reported its FY 2024 results and it’s all about the operating income, which is up a wild 76.4% year-over-year, or about $1.7 billion. At the same time, revenue went up about 24% to $32 billion.
Mazda makes most of its cars in Japan, meaning the dramatic drop in the yen had an outside impact on the company’s bottom line. Hybrids are also a big part of Mazda’s present and future, and the company is already planning to roll out a hybrid CX-50 in the second half of the year.
Watch The Trailer For No Perfect Formula
I left the production company TangentVector a little less than two years ago to join The Autopian and go on this adventure with all of you. The reality of filmmaking is that the distance between pitching the idea and doing it, as measured in time, is quite large.
One of the last things I briefly worked on was a pitch for this documentary about Cadillac going to Le Mans. Now it’s a whole movie that’ll be airing on Hagerty’s FAST channel later this month at 7:00 PM. Watch the trailer! It’s great and has a very Truth in 24 vibe.
Having made a Le Mans doc with much of this crew I was a little jealous watching them post on Instagram about being there, but also grateful I didn’t have to deal with French rental cars.
What I’m Listening To While Writing TMD
Ezra Furman is so good and her work on the Sex Education soundtracks perfectly encapsulates that feeling of profound teenage yearning the show also does, along with a healthy dose of sweaty angst and gleeful stupidity. I can’t even pick out a best song, just listen to all of them. #teamruby
The Big Question
What’s your favorite motorsport film? It can be a doc or it can be fiction.
Regarding Elon rushing stupid moves like dissolving the two most important teams in his most stable business to save $3,000,000,000 only to give himself a bonus of $5,300,000,000… I’m surprised nobody’s tried to oust him yet. Tesla is stable at this point and needs a different type of leadership than the kind that fosters startup success. It’s like a supervillain and his henchman at this point. You don’t know why the hell they stay there, because the sheer chaos and number of things getting destroyed at random far outweighs staying there.
Favourite motorsports film? Redline. SEVEN YEARS HAND DRAWN! It’s basically the 1972 incarnation of the Cannonball rally but in space, and the main character is a greaser who relies solely on his front engine, rear wheel drive, piston engine car while going up against a guy who’s literally built into a tank, a space cop gone rogue, a giant Transformers style robot driven by two pornstars, an evil Captain Falcon and genocidal Jason Todd, Mandark and miniature Elton John, and a fighter pilot and his mechanic.
Tesla’s board is made up of people too close to Elon, including his brother Kimbal Musk. That is why there has been no pushback for Elon’s compensation package from the board.
See this article:
https://finance.yahoo.com/news/judge-rules-favor-plaintiffs-challenging-214636522.html
and this discussion:
https://opposite-lock.com/topic/92813/elon-musk-s-pay-at-tesla-was-ruled-so-high/
“What’s your favorite motorsport film?”
So far it’s Ford Vs Ferrari
Thanks to index funds, Fidelity, Vanguard and others control a lot of Tesla stock. These companies have a fiduciary responsibility to act in the best interests of their clients.
A day of reckoning is coming for Tesla where this crap can’t happen anymore.
Those funds (and their clients) mostly only care about returns. They won’t do shit about any company that ‘cuts costs’.
They have a fiduciary responsibility to their clients to make sure that the business is well run.
Not sure it qualifies as a racing movie per se but Cars is in my top five favorite movies of all time, inclusive of all genres. It’s just so damn good. It might be the only movie ever oriented towards gearheads that actually understands gearheads.
Hell yeah, same here. It’s just so awesome and well made! I have the DVD and now want to watch it again
If Elon was concerned about good business practices and taking care of his customers, he wouldn’t have (fill in the blank)
Best Car Movies:
It’s a Mad, Mad, Mad, Mad World (1963)
and
The Love Bug (1969)
Not motorsport per se, but The Italian Job (1969) is an amusing classic caper with silly driving shenanigans. Micheal Caine is a legend.
Somewhat embarrassingly, I watched Gone in 60 Seconds (2000) as a 13 year old and was thoroughly convinced that Nicholas Cage was the height of cool. That film is quite likely what sparked my affinity for silver cars.
I like old French or Italian movies from the 60s-70s with epic car chases through tiny streets, driving 65-hp shitboxes like Renault 12 or Renault 16 or Autobianchi A112.
I generally don’t watch racing movies,they all tend to suck. I would go with “Cars”
The site is large enough and daily traffic strong enough that I think you should consider breaking the morning question of the day out into its own post.
As is, the discussion of multiple points, plus the QOTD can get pretty distracting.
Death Race
Best movie has to be Rendezvous by Claude LeLouche. Hope spelling is right, but first saw it in 1985, and remembered it after seeing it again 15 years later. Nothing beats the sound of 12 busy cylinders and an open exhaust.
Lelouch, close enough.
Take it to the Limit.
Peter Starr’s amazing motorcycle racing documentary. It may not have On Any Sunday’s wonderful Southern California vibe (Bruce Brown is awesome), but the racing, the soundtrack, and the actual participants are second to none.
Mike Hailwood narrating the Isle of Man tt course while he rides it full out, Kenny Roberts showcasing both his flat track and road racing expertise, Arlo Guthrie doing “the Motorcycle Song,” and so so much more.
Grand Prix, 1966. James Garner.
Every time I watch Dirty Driving: Thundercars of Indiana, I feel like I’ve won a six-foot trophy.
$500M for “thousands of chargers?
Even if it’s 9,999 chargers, that’s $50K per charger. How many watt-hours are needed and how long will that take to make that investment back?
This kind of backs up my theory that chargers are not very profitable and that is why no one is rushing to make install more of them for public consumption.
I’ll go with Cannonball Run II, just because of the Starion (1983, with the properly-slanted air dam, one of which I owned) with Richard Kiel driving and Jackie Chan sitting in the back behind some fictional tech gizmo taking up the front passenger seat.
One of the worst films ever, according to Rotten Tomatoes and a wide variety of film critics forced to watch it for work.
It’s cheaper to install chargers than build a gas station but chargers don’t have snacks to supplement. It’s also why we are seeing so many truck stops and places like Buccee’s adding charger.
Yeah. All the problems associated with the charger business, from uptime to profitability would also apply to gas pumps if they were managed the way charging has been. Gas pumps would be hilariously unreliable if you installed them in the far corner of mall parking lots, and forgot about them for six months. Never mind the fires…
The business model for public charging has always been staring us in the face- the gas station. EV drivers need snacks and squeegees to wipe bugs off their windshield too.
There was some weird aversion to the “filling station” for EVs for a while. It’s one of the places that makes sense. The benefit of EV chargers is that you can also have them at grocery stores, malls, and other places that have the parking available. While all those alternatives are great, when on a road trip having a restroom, snacks, and some sense of civilization at a stop is nice. It adds safety as well. Stopping at some charger behind a grocery store can be frightening for some demographics.
Each charger is definitely cheaper than each gas pump, but I suspect it’s a different story in terms of cost per car/hour capacity, or we’d be seeing charging stations with convenience stores similar to gas stations. I’m sure someone at Buccees knows the economics of this. It will be interesting to see how it works out for them.
There have been companies pioneering this already. The chargers would not be the major profit center and will likely not make as much as the petrol, but stations always have made more with their convenience store than the fuel.
Wait a minute! I see a potential goldmine here! Quick get Elon on the phone.
Smokey and the Bandit was my favorite car movie (and favorite overall movie) until I was a teenager. Now, I’m not sure. I tend to watch movies once, and then I’m done with them forever. When I was a kid, I watched the Smokey movies every chance I could get, though.
My favorite motorsports movie is the middle act of Star Wars: Episode I: The Phantom Menace.
LOOK, I JUST WANT A FEATURE-LENGTH PODRACE MOVIE, OKAY ????
The podrace sequence grinds the movie pacing to a stop, but it’s the most exciting part of the movie, including the ground and space battles. It would’ve been so cool if they’d had just a short bit of racing in the movie, then done a spin-off about Podracing (with all the wacky characters). Disney+ could do it, but 25 years ago was a very different time.
My favorite car movie might be an even worse movie: Tokyo Drift. It’s so bad, it’s good, and they brought some wonderful cars in for shooting.
They did such a bad job with the podrace sequence that you really didn’t get the feeling that the drivers were really driving. It seemed they were just along for the ride on fast graphics, and every now and then something dramatic happened out of nowhere.
Best TMD Big Question ever! The comments section is pure gold 🙂
I am a Fast & Furious franchise fan. They are objectively terrible, but I love them anyway. I guess I grew up with them and I almost hope they keep making them until I am no longer around :p
Shout out for Cars. That’s my favorite movie period, and I will make no apologies. I tear up every time at the end…
Stupid move by Tesla, since the superchargers can be more profitable than the cars. Add a store to the Tesla “gas stations” and the money will come in.
We already know that Elon doesn’t act in Tesla’s best interests (see the shareholder suit over his compensation package).
This feels like a temper tantrum due to that, to be honest. It seems to fit the character Elon revealed himself to possess with the whole continued Twitter mess.
Yes, that seems to be the case here. Sites are reporting that Elon’s firing is due to another tantrum:
https://electrek.co/2024/05/10/elon-musk-tesla-spending-500-million-superchargers-after-firing-entire-team/
Is it that stupid? I’m doubtful that there’s any profit in the superchargers at all. They’re a necessary cost of doing business for Tesla. Now that Tesla’s competitors have committed to interoperability, Tesla can make building chargers their problem, knowing full well that at least for the next few years, most of the users of NACS charging stations paid for by the big 3 will be Tesla owners.
There might not have been before, due to the cost of installing them, but now that they’re installed, they can make money off them, charge by the kwh, etc.
I guess it would be at least as profitable as a gas station. The cost to maintain could be lower than a gas pump’s cost (electricity is easier to transport than liquid fuel), and they can always add a store or restaurant to it too.
Elon Musk fired the team due to a tantrum he had, like he does a lot. BP is recruiting the supercharger staff and might even want to buy some of Tesla’s superchargers.
But gas stations aren’t profitable. The attached and staffed convenience stores are.
The retail price of power via DCFC station varies enough that I don’t know what number is reasonable to use, and in 5 minutes of looking just now it seems I can’t find out what my local price is without actually setting up an account with a charging network. I’m just going to assume $0.40/kwh, which I think is on the higher end of the spectrum. That power costs ~$0.20 kwh in my location, so the profit is 50%.
Best case scenario, you’re charging M3LRs all day, they’re lined up waiting for your charger 16 hours/day, and everyone arrives at 10% SOC with a perfectly preconditioned battery capable of doing a 10-80% run in 20 minutes, doesn’t charge past 80%, and there’s only 2 minutes of down-time getting each car out of the spot and replaced with the next car. That’s a 57 kwh charge, worth $11.48 profit, taking 22 minutes. you can service 43 cars per day, making your daily income a little under $500. That’s actually really good. The DCFC station itself likely cost about $100,000, so even if you’re paying it off at 8% over 5 years (~$2k/mo), you have some money left to pay the rent on the real estate you occupy and still make good money.
But in reality, the line only looks like that on Thanksgiving weekend at the midpoint between San Francisco and Los Angeles, and if the normies are going to accept BEVs, it needs to never look like that anywhere ever. 1 car per daylight hour cuts your daily income to below $200. One car per hour only during morning and evening rush hours brings you below $100, and now you’re starting to crowd just the fixed costs
How busy are the Supercharger stations in your area? Where I am, its rare enough to see one occupied that I always double-take.
Too late to edit, but I forgot to add: it actually gets worse from there. The efficiency of DCFC leaves a lot to be desired in comparison to plain old L2 charging – you’re likely having to pay for ~20% more electricity than you are selling to your customer, due to conversion losses dissipated as heat. This cuts your profit margin. The vehicle side has some efficiency penalties when charging so fast as well, though that will result in you selling somewhat more power to the customer than they are getting into their batteries.
where I am, the non-Tesla charging stations are occupied!
A nearby Walmart has Electrify America charging stations, and the last time I was at that Walmart, they were full! All the EA chargers were being used! I don’t remember all the models of the cars were there, but here was at least 1 Rivian and a Hyundai or Kia of some sort (it might’ve been an Ioniq 5)
If those are being used, then I’m sure the Tesla superchargers get plenty of use, too!
i drive by empty petrol stations all the time. It’s not like they have constant business. The cost of building a typical petrol station with the tanks has got to be massive. It’s also a massive cost to remove those tanks. A charging station with solar panels and batteries can recoup the costs faster. Battery storage prices have come way down. There are also chargers with integrated batteries that could benefit from solar panels to replenish them for part of the year anyway.
Where I am in California, within 5 miles there are 5 charger locations. 3 of them are full almost all the time. One has 20 chargers and regularly has 15 in use. Right now, at 9:05 AM on a Monday we have 2 with a wait. 20-unit charger has 14 available and the new 16-unit has 11 available. One one of the chargers in my area is V2 and not open to Ford and Rivian.
Sounds like it’s getting there, then, at least in your area.
Just keep in mind that an 8-stall charging station can process 16-24 cars per hour. That’s 16-24 potential customers for the convenience store. With 2 minute fill-ups, an 8-stall gas station can process 240. That “empty” petrol station is likely serving more traffic than a DCFC station could even hypothetically at peak. Good chance that a higher percentage of charging customers are successfully converted into store customers, but one can’t squeeze blood from a stone
Ah, somebody finally caught on to the fact that Ford’s solution for all of the leaks in their engines is not to fix the leak, but to provide an easy path for the fluid to exit the vehicle. This should be entertaining.
Does “Cars” count as a motorsport film? Lightning is racing in the Piston Cup.
Days of Thunder is a good old fashioned easy 90 minute movie, I’d watch it any time it was on TV. Bonus for having an unknown John C. Reilly in it who would later be part of Shake n Bake in another great motorsports movie.
He did what in his cup?
https://www.youtube.com/watch?v=GEm0e_dhPVM
Indeed.
Thought we’d get to this clip instead.
https://www.youtube.com/watch?v=3WC1YZ1o0UY
Meanwhile, I read that BP is looking to snap up much of the Supercharger team that was cut. So they are positioning to move into the arena a bit more.
I read that too, in this article.
Trump: If you oil companies donate $1 billion to my campaign, I promise I will do away with regulations and ensure you make as much profit as possible.
BP: I’ll think about it, but building an EV charging network is going to be a pretty good money train now that we’ve hired all the laid off Supercharger staff.
That power’s gotta come from somewhere, might as well come from BP’s bread and butter.
Now that non-compete agreements are no longer enforceable, I suspect we’ll see a few charging startups pop up from the supercharger team, with an actual existential incentive to make ubiquitous charging a thing, as opposed to VW’s spiteful foot dragging on EA.
Firing the supercharger team might cause some problems in the future, but those are problems for Future Elon to blame on someone else.