How does Tesla offer such a low charging price?

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The battle for fast charging is raging in the world of electric vehicles. On the one hand we find Tesla with his Superchargers, and on the other all the players like Ionity, Fastned or Totalenergies. How does Tesla manage to build so many terminals at a lower price than the rest of the industry? Let’s see this together.

In France, in Europe and in the world, two entities compete in terms of fast charging of electric vehicles. On one side is Tesla, and on the other is… all the other players. In fact, either in terms of location of terminals, method of payment or number of terminals per stationTesla is an exception to the others.

We have already returned in detail to the advances of Tesla Superchargers in France, its opening to other brands, or the differences between this network and the others present in France.

In this file, we will return to the differences in terms of installation costs for fast charging stations and try to see why Tesla is ahead of the rest of the industry. Finally, we’ll see if those who build cost-effectively still achieve a reliable network that requires little maintenance.

Tesla Superchargers are simpler than other charging stations

If you’ve ever walked past a Tesla supercharger, You will have noticed that the characteristic minimalism of the interior of the brand’s vehicles is also found in its fast charging stations.

Unlike almost all other players in electric mobility, the terminals of a Tesla Supercharger are devoid of screen and payment terminal.

A Tesla supercharger // Source: Frandroid

For Tesla owners, it’s a great experience: plug in, charge. For others, now that some Superchargers are open to everyone, it is necessary to go through the Tesla app in order to initiate a charge.

This lack of screen and hardware authentication system allows Teslasave a significant amount on each terminal installed. When new facilities have 16, 20, sometimes 28 terminals, it starts to cost.

Furthermore, as we will see, Tesla controls the supply chain better than anyoneallowing you to reduce costs and limit intermediaries.

Vertical integration, the key to minimizing costs

Tesla’s factories aren’t there just to make electric cars. In fact, if we take the case of the gigafactory in Buffalo, New York, it doesn’t even make any.

Instead, they are superchargers (as well as solar panels, solar tiles, Powerwalls and Powerpacks) leaving the production lines, allowing the American firm to optimize its costs.

In fact, by not subcontracting the manufacturing of charging stations to other manufacturers in the sector, Tesla ensures on the one hand that they have a product that perfectly meets their needs, and on the other hand that they control costs. it is not possible otherwise.

In the second half of 2021, a 5,000 m² complex was also built in the Shanghai gigafactory, with the aim of producing 10,000 Supercharger terminals per year. If we are to believe the strong growth of Supercharger installations in Asia and Europe since then, the factory is running at full speed. The economies of scale achieved in such volumes are undoubtedly very high..

Finally, and this is one of the differences between Tesla and other players, the choice of sites for the establishment of off-highway Superchargers undoubtedly has a strong financial impact. It’s a safe bet that 20-30 parking lots to recharge are less expensive off the main roads, thus lowering the average cost of setting up a terminal.

A very different deployment with other players

In 2022, Tesla had shared a document about installing a supercharger in Texas, which indicated a Average installed cost of $42,000 per charging station. Compare, Bloomberg indicates that the prices of a fast charging station installed by Electrify America in the United States, or Ionity, Fastned, Totalenergies and others in Europe range from $100,000 to $250,000.

As we specified previously, the fact of not having a screen, a payment terminal, or a subcontractor for the manufacture of the terminals contributes to a great extent to the minimization of costs, but according to Bloombergthis can eventually divide them by 6. In other words, a Tesla Supercharging station with 24 terminals may not be more expensive than an Ionity station with only 4 terminals.

What’s more, if Ionity, Electrify America or other fast-charging players benefited from government credits reserved for those whose terminals are accessible to all vehicles from the very beginning, from the opening of Tesla Superchargers to the competition, the American manufacturer can take a piece of this cake valued at almost 7,000 million euros in the United States alone.

Reliability that puts Tesla first

If Tesla is cutting costs when it comes to its superchargers, what about reliability? Again, it is necessary to remember the size differences between Tesla Superchargers and other fast chargers. Without screen or payment terminal, potential failures are minimized: power failure or faulty hardware.

the stories about the Ionity or Electrify America terminals in particular that are out of service abound in the forums of connoisseurs of the connected car. The rule at Tesla is rather that everything be functional, and the exception is finding a faulty terminal (among the dozens in a station).

The proof is, Tesla’s latest impact report announces an incredible 99.96% global availability for its superchargers.

Graph on the availability of Tesla Superchargers between 2018 and 2021 // Source: Tesla

This figure is light to moderate as the selected methodology is there to highlight an excellent score. A Supercharger is advertised as available if at least half of the terminals are operational. Therefore, a site with one terminal out of the twenty or so available terminals is indeed marked as available.

However, one must compare this exceptional figure of 99.96% availability with the latest statistics published by Avere: in France, fast charging points of 150 kW or more had an availability rate of less than 78% in January 2022. This shows that Tesla has not only optimized costs, but also the reliability of its equipment.

Good ideas that are not only in Tesla

The picture drawn so far could suggest that only Tesla has great ideas. Of course, this is inaccurate, because there are still significant differences between the players in electric mobility, and some do not highlight Tesla.

First of all, the part about the location of Superchargers is something that cannot be ignored in 2023. If a few years ago Tesla led the way in terminal deployment, it was acceptable to take a detour to go charging during long trips, but today it is no longer the case.

This has become a phenomenon even within the Tesla driver community, who sometimes prefer to use third-party networks to optimize travel time and save 5-10 minutes every two hours.

Also, Tesla’s ease of use is no longer exclusive. Fastned has rolled out the famous Autocharge, Plug & Charge is slowly coming to Ionity, and when other players allow an experience that comes down to ” plug charge« , Tesla could become a secondary option for even more drivers.

Also, while some superchargers have sunroofs that protect against rain or shine, the vast majority of Tesla’s charging stations are outdoors. Unlike Fastned once again, who has even made it his trademark.

Finally, for owners of 800 Volt battery vehicles, Tesla Superchargers do not allow charging at full power, where Ionity, for example, offers power of up to 350 kW for these vehicles..

Tesla’s superchargers still include the essentials today: it is a reliable, dense network, and where the number of terminals per station is large enough to not be afraid of queuing before loading.

In addition to building lower-cost terminals, Tesla has recently allowed itself to dramatically lower the charging prices of its Superchargers, making them even more attractive to those on the go who want to minimize costs.

For a Tesla driver, as of February 2023 they are up to 40% cheaper than the Ionity in particular. Is this enough to rekindle the desire to get paid at Tesla for those who had defected from the network after the repeated increases?

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