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Summary:

Similar to Apple’s strategy, Tesla has been creating a closed ecosystem, and in Tesla’s case it’s around electric car charging. And that’s not so great for the electric car drivers of the future.

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This article originally appeared on GigaOM Pro, our premium research subscription service.

If we’ve learned anything over the past couple months about Tesla, it’s that the company is concerned about range anxiety, particularly as it heads into the next couple years in which it’ll try to make a splash in the mass market. It opened the summer by demoing battery swapping technology in the Model S and most recently has aggressively pursued those with access to retail and commercial parking space in a quest to put 98 percent of U.S. drivers within range of a supercharger by the end of 2015.

Tesla Model STesla is willing to foot the entire $100,000 to $175,000 bill of installing superchargers in public venues. The prospective “supercharger hosts” don’t have to do much. Tesla covers the costs, including electricity, construction and ongoing maintenance. All the real estate provider has to do is agree to allocate half the spots to Tesla only supercharging and the other half to all EVs. Presumably the hosts, which might be upscale restaurants or fancy malls, get the benefit of having Tesla owners accessing their services while they wait for their Model S to charge.

Tesla’s strong moves in not waiting for a charging network to materialize but instead creating an expansive one itself, points to an unprecedented trends in the automotive space. Tesla is an automaker that isn’t just producing a car but is involved in supplying energy to make that car go, a much more fully integrated enterprise.

Tesla's line of Model S carsNow that’s all well and good for Tesla, but what about the entire EV landscape? Tesla’s supercharger utilizes a proprietary plug, and although the stations its planning to build will have four to six EV spots servicing any vehicle, four will be dedicated to Tesla. Imagine going to the gas station, and four of the pumps were reserved for BMWs. When the automakers get a say in the powering of their EVs, they are choosing to create closed systems that exclude their competition.

Tesla isn’t the only one taking a proprietary approach. There’s been a long brewing conflict between the Japanese and American/European automakers about which plug to use for fast charging. It’s unresolved and we’re about to see a betamax vs. VHS showdown as the Japanese automakers have adopted CHAdeMO plugs while the likes of GM will use the SAE combo coupler. In a sign of how crazy this will get, the largest independent owner of charging stations Car Charging Group will install 48 CHAdeMO fast chargers in various cities by year end only to subsequently switch support to the SAE combo coupler.

Tesla Supercharger 2013I’ve never been a fan of proprietary plugs nor the land grab that is likely to occur among charging network startups. The consumer will lose here as will the overall EV industry as the world will get less convenient for road tripping EV drivers in need of a charge as drivers search for a station with their plug type. That will make it harder to sell EVs. Tesla’s recent moves to build out its own supercharging network is one more example of this trend.

Tesla’s behavior overall reminds me a lot of Apple in its attempt to create a closed ecosystem. While I suspect Tesla felt its designs and engineering were better than any fast charging standards out there, I also think the company liked being in control of its brand at every step of the way, including the charging one.

In the end what we need is a cost effective, easy to use charging system for all EV owners, particularly with fast charging because it can unlock the ability of EV owners to take roadtrips and hence address a major range anxiety concern. What we’re getting is a decade of standards fighting over the best fast charging plug and an inherently less convenient system for the consumer, which will damper the prospects of overall EV sales growth.

  1. I don’t see a problem at all with Tesla’s model here. The fact of the matter is, not only can anyone build their own charging network and charge for it (like any traditional gasoline station), but Tesla is providing half of spots in the network that they’re building at their own cost to everyone — for free. So this is actually a net benefit not only to the growth of the electric car market by increasing the number of charging spots around the country, but also to the attractiveness of Tesla cars — which are also all electric. Win for environment, win for consumers, win for Tesla, loss for no one in any way.

    Honestly, we should encourage Tesla to build as many charger stations as possible because it benefits everyone solely at a cost to Tesla.

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    1. Michael Scharf Thursday, August 8, 2013

      The problem with a closed system is not the charging stations, it’s what do you do when you get home. Remember, most people will be charging their car at home, most of the time.

      Suppose your first EV was a Nissan Leaf. You install a $2500 charging unit at your home, so that you can charge the car overnight.

      Five years later, you’ve done well, and want to sell your home. The person you’re selling to owns a Tesla. Now the upgrade you made, is an appliance that must be torn out of the wall and replaced with another $2500 charger.

      And then five years later, he sells the home…

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      1. Actually it would be no problem at all…. Now, going the other way would be a problem.

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      2. This is not a reasoned criticism, Michael. (1) Home chargers do not cost $2500. (2) Most can be installed with NEMA receptacles rather than hard-wired, making it no less convenient than if the previous homeowner were to take their clothes dryer. (3) The Tesla plug, while proprietary, comes with SAE adapter (for Level 2 stations) and they are promising one for CHAdeMO (DC Fast Charge)as well. (4) Even if your scenario were true, a retrofit/remodel costs far less than 1% of the purchase price of the house and would hardly be a deterrent.

        I agree with Lesser that there are future hurdles to overcome, but this is not necessarily of Tesla’s doing. Until the industry resolves the CHAdeMO vs SAE Combo-Coupler debate, Tesla has simply decided that they have a better way that works for their customer base. As an EV owner, I am utterly thankful that Tesla/SolarCity has committed to dedicating *half* of each facility for generic EV use. They are under no obligation to do so! If this were truly a proprietary lock-in situation as Lesser seems to think, the entire setup would be 100% supercharger.

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      3. No – Sir – you are actually wrong! The $2500 Charger you put in will still charge at the same rate on the Tesla as it did on your current EV – maybe even higher – as the Tesla can accept the full power it delivers, and all it needs to do to us it – is to plug the Tesla Commonly Provided J1772 (EV Standard) Adapter (to the Tesla) and then plug in the Tesla. In Fact – Tesla Owners Carry this adapter with them and use it today at all common Public Chargers. – http://www.teslamotors.com/en_CA/charging#/outlet

        While it will typically be a 30 Amp Charger you have installed and a Tesla Model S can handle a 240V Feed from a 100 Amp Service of their own – the installed unit will work fine – if not as fast as one might like. YOu could either – leave it as is, or choose between upgrading the whole circuit to a 100 Amp feed, or add a separate 100 Amp Feed, as I have seen done in garages – as listed on http://www.plugshare.com private owner listings in home that either upgraded from a lower level car – or added a Tesla Model S to their EV Fleet.

        Also – Tesla Superchargers put out 90 to 120 kW worth of power and the Existing CHAdeMO Level 3 Fast Chargers are topping out at 50 kW, as well as the coming SAE CSS (Combo Charging Plug with J1772 + Level 3 DC Fact Charging) also having lower power delivery limits than the Tesla Charger.

        One Good thing about different Plugs, just like different pump nozzles – is so you don’t put Gas in a Diesel Truck and Diesel in a Gas Truck, etc. – in case you had a Nissan LEAF – you would not want to be charging it’s little battery pack with a 90 kW – Let alone a 120 kW Charge Feed!

        And – you might have missed the comment – that Tesla might even licence it’s supercharger plug system to others (might not be free for these non-Tesla Drivers to use the network though.

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      4. Robert Weekley Sunday, August 11, 2013

        Actually – Tesla Model S comes with an adapter to use the commonly installed Home EV chargers – that (if not Tesla’s) will be a J1772 Standard) – which is the same as all other level 2 chargers – that Model S owners use an adapter to charge from!
        http://www.teslamotors.com/en_CA/charging#/outlet

        Not Even Tesla Owners install Level 3 DC Fast Chargers at home!

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      5. FYI as a Leaf and Tesla owner in sunny Hawaii who charges his cars with a solar system I see no problem here. I in fact first owned the Leaf and did install that wall mounted ‘appliance’ using the ‘J’ connector that all the public chargers use around here. The Model S comes with an adapter for this connector and although the wall mounted system for the Leaf only outputs 30A I find it more convenient to use it that the Tesla charging cable.* I assume all cars with a different system will have available this type of adapter.

        Lorn Douglas
        Kalapana, Hawaii

        * Having a wall mounted cord always ready to plug inti the car is way faster and easier than than unrolling out the Tesla charging cable and having to roll it back up after charging. Plus its prob better to charge more slowly anyway.

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  2. The future of electric cars is battery cell swapping as on the Tesla Model S, not charging.

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    1. Robert Weekley Sunday, August 11, 2013

      Like Elon Says about Swapping – ‘Fast or Free’ – which means – continue paying as much as you would for a similar car’s tank of gas so you can be back on the move in under 2 minutes (93 Seconds on the swap demo) … OR – Plug into his Superchargers – for Free, and go grab a snack, hit the washroom – stretch your legs, and in about 20 – 30 minutes – get back on the road again!

      Not that buyer of a Model S would not be able to afford the $50 or so to swap, it would only benefit critical travel needs. When you can Do 3 hours of driving and take a 20 – 30 minute break, or stay stuck in your car for 6 – 9 hours – will be a personal and commitment choice, I am sure. I have driven from Northern boundaries of about 2 hours outside of L.A. – to Long View Washington in one Day – but it is not the kind of driving I normally do.

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  3. “Imagine going to the gas station, and four of the pumps were reserved for BMWs.”

    If BMW is owns the station and is paying for the gas, why shouldn’t they reserve pumps for their customers? Tesla buyers are paying for the supercharger network, why should some other car company benefit? They are a for profit company not a charity.

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    1. No one is saying they should offer free charging to other companies. That’s absurd.
      They should however licence their charging standards so that other cars can charge at their stations.

      The system Tesla is building (and encouraging on other companies) is extremely wasteful. What if every car company decides to do the same thing? You would have 20 as many charging stations as there are gas stations. It would be the same as Exon saying only GM cars can get gas from my station, Shell – Volskwaggen, BP – Jaguar, etc…
      Does this make any sense to you?!

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  4. What a closed short-term mind. Not Tesla. Lesser.

    Tesla isn’t going to continue building success by becoming an open-source niche charity like Linux.

    There is always room and opportunity to add more charging systems and devices. If not within 4 feet of a Tesla – then across the street. About as dumb as insisting that Chevron leave half their pump space to Total. Let ‘em open a station across the street.

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  5. Chad Lawrence Thursday, August 8, 2013

    I really don’t think there’s a betamax vs. VHS showdown because CHAdeMO plugs are used for DC Fast Charging (also known as Level 3 ), while the SAE J1772 is used for Level 2 (240 Volt) charging stations.

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  6. I would hope that Tesla succeeds and that this stimulates competitors to invest equally, or in aggregate, more.

    Sure Tesla has a first mover advantage. But the underlying material science progress will help the followers, and their investors.

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  7. It’s not just the “plug” as I see in so many articles, but the entire technology is different.

    Let’s look at the big picture here though:

    1. Tesla is paying 100% of the supercharger stations. They are offering FREE charging for life for the Model S and future models. While it’s their goal to get the power for superchargers from solar power, it’s not going to be that way for awhile. Tesla is going to have to pay for power from the grid for the superchargers (for awhile at least). Why should Tesla pay to charge competitors vehicles??

    2. Tesla doesn’t have time to wait for a fast charging Industry standard to be developed by others. They are selling over 20,000 vehicles a year (and rising quickly) NOW. And it’s not quite the “closed system” Apple uses. Tesla is more than willing to license their fast charging technology of others (something that Apple would never consider) – in a way, making their Supercharger system the de-facto standard. I believe that Toyota and Damiler will eventually do this. If they do, the rest of the industry will quickly jump on board…

    3. In the big scheme of things, supercharging is a small part of EV ownership. As has been talked about, the majority of people will use 240v charging at home the majority of the time. Supercharging is for the occasional trip outside the vehicle’s range – - – this too will be needed less and less as battery technology improves quickly in the next few years.

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  8. Hey Adam. Wake the fuck up! Ford wont do warrantee work on a Toyota! Why should Tesla provide a service to other people’s customers. Isn’t it enough that Tesla Motors almost single handedly recreated the modern electric car from the ashes of the EV1 market segment?? Get a grip! Instead of whining about what Tesla isn’t doing for you, or other EV drivers, take a look at yourself and the other EV makers who aren’t even making cars that people can drive more than 100 miles. Whine about THAT!!

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  9. How much it cost to build a supercharger station? 175 000$? What a deal! The smallest gaz station cost at least 3 times more! A normal station probably cost nearly 1M$!

    The real question is : will a real standard war occur? It is so cheap to build fast charger stations, that may be they will live together for a long time. And probably that future charging station will eve support both ChaDeMo and SAE Combo. And probably that in the first few years, people will have converter which will become quickly useless as the number of charging station growth.

    At the end, I think the only standard who will win will be the more convenient one. One day, people will want the fastest charging plug, and if Nissan or GM start to lose sell because of not having this plug, they might reconsider their choice.

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    1. Robert Weekley Sunday, August 11, 2013

      ABB Is already developing the Multi-standard Fast Charger systems:
      http://www.abb.ca/cawp/seitp202/4a562716488bcf4bc1257b470029e41f.aspx

      SAE Combo is coming out – plus AC Fast Charging for Europe, and CHAdeMO for Other areas.

      And – currently – their single port CHAdeMO unit at 50 kW is just $27,000, and their 20 kW Version for Malls (Where you can spend more time shopping normally) is only $17,000. Of course – normal Level 2 EVSE (Charger) units are only about $1500, but they are one of the few players with all buyers multiple levels of charging – Level 2, Plus two variants of Level 3 – depending on service application.

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