NEW YORK--General Motors will join Ford in adopting Tesla's North American charging plug standard and give GM electric-vehicle buyers access to the Tesla Supercharger network under an agreement announced on Thursday.
GM's move, which follows a similar decision by Ford to embrace Tesla's charging plug standard, means three of the top EV sellers in the North American market have now agreed on a standard for charging hardware. The agreement was announced by GM CEO Mary Barra and Tesla chief Elon Musk in a Twitter Spaces event. Investors applauded the deal, and the prospect of one charging hardware standard for the North American market. GM shares rose more than 4% after the bell and Tesla shares rose 4%. The alliance among the three leading rival U.S. EV manufacturers has significant commercial and public policy implications. The Biden administration made adoption of a rival "combined charging system" (CCS) standard a requirement in order for companies to be eligible for billions of dollars of federal subsidies for new charging stations on some 7,500 miles (12,070 km) of the nation's busiest roadways.
The alliance among Tesla, Ford and GM challenges the White House's direction. But Transportation Secretary Pete Buttigieg told CNBC in May after the Ford-Tesla deal that the industry will eventually converge on one system but that adapters would allow cross- usage. Tesla, GM and Ford together account for about 70% of current U.S. EV sales. Industry executives see differing EV charging connectors as a barrier to wider consumer adoption of electric vehicles. "I think this is just going to be a fundamentally great thing for the advancement of electric vehicles," Musk said during the Twitter Spaces conversation with Barra. "I think it all just got a little better," Barra said. GM could save $400 million from the agreement, Barra told CNBC in an interview Thursday. From a consumer standpoint, the deals with the Detroit automakers look like a win for Tesla, which invested heavily to deploy its distinctive fast-charging stations across North America when most other automakers delegated charging to third parties. Tesla Superchargers account for about 60% of the total fast chargers in the United States and Canada, according to U.S. Department of Energy data.
"This is pretty huge," Consumer Reports senior policy analyst Chris Harto said. "I could see this being kind of a snowball effect of more and more automakers jumping on board and shifting towards the Tesla standard." For GM and Ford, the deals are a wager that the benefits of giving their customers access to Tesla's extensive rapid charging network outweigh the risks that their customers will like what they see and choose Tesla for their next purchase.
