General Motors announced Thursday it will use Tesla technology to charge its electric vehicles and will sell models that use Tesla-developed connectors.
The announcement, which came two weeks after Ford reached a similar agreement, is likely to make Tesla’s plug the industry standard and pressure companies competing to build similar networks as electric vehicle sales soar. The agreements mean owners of Ford and GM vehicles can use Tesla chargers, which are often the only ones in many places and are known for their reliability.
“This will nearly double access to chargers for GM customers,” Mary T. Barra, the automaker’s chief executive officer, said during a stream Twitter conversation with Elon Musk, the CEO of Tesla and owner of Twitter.
Mr Musk said the deal “will be a fundamentally great thing for advancing electric vehicle adoption.”
However, it could raise concerns that Tesla, which already dominates electric vehicle sales, could overwhelm its competition in the fast-growing charging business.
While GM gets access to more chargers, Tesla will make money selling power to owners of other automakers’ models. Tesla has charged owners of these other cars higher fees than owners of its own cars. The electric-car maker also needs to open up its grid to receive a portion of the $7.5 billion the federal government is spending to speed up the construction of charging stations.
By adopting Tesla’s charging standard, Ford and GM also risk becoming dependent on their biggest competitor. No Michigan-based automaker sells anywhere near as many electric cars as Tesla, nor does it operate a charging network.
The agreement also poses risks for Tesla. The popularity of its cars has caused congestion at the company’s charging stations in some cities and along some highways. Tesla owners might be annoyed that they now have to wait in line with cars from Ford and GM
“I don’t think Tesla owners will be happy to watch a Ford Mustang Mach-E being charged while waiting in line,” said Ben Rose, president of Battle Road Research, which monitors the auto industry.
The battle between Tesla’s charging plugs and those currently used by Ford, GM and other automakers is reminiscent of the competition between Betamax and VHS videocassettes in the 1980s. Ultimately, VHS won the battle.
On one level, competition between standards is a complicated technical issue, with each side claiming their connector is the better choice. But it could have long-term implications for the millions of people expected to switch to electric vehicles in the years to come.
Tesla sells cars with a plug known as the North American Charging Standard. Ford, GM, and most other automakers have sold cars with connectors that use the Combined Charging System connector. The two are not compatible.
Fast chargers from companies like EVGo or Electrify America usually have both plugs and can charge both Teslas and cars from manufacturers that use CCS, including Mercedes-Benz, Volkswagen and Volvo. For most of its roughly 10-year history, Tesla’s network has been closed to cars from other manufacturers, but the company has recently started allowing other cars to use some of its chargers.
The reactions of the competitors were restrained on Thursday. “We support all steps taken to increase EV adoption,” Blink Charging chief executive Brendan Jones said in an email. He added: “We are closely monitoring the market and will adjust as we deem necessary.”
Investors welcomed the deal. Tesla and GM stock prices rose about 3 percent in extended trading on Thursday.
This year looks set to be pivotal in GM’s electric vehicle ambitions. The company is just weeks away from offering a battery-powered version of its Chevrolet Silverado pickup truck. There are also plans to introduce electric versions of the Blazer and Equinox sport utility vehicles.
Ford is working to accelerate production of its electric F-150 Lightning at a factory in Dearborn, Michigan.
Mr Musk said while speaking with Ms Barra that Tesla would not use its control of the country’s largest charging network to disadvantage competitors. However, should Tesla’s standard prevail, other operators will depend on a competitor’s information to manufacture and install charging networks.
Jonathan Levy, EVgo’s chief commercial officer, said the company hopes the North American standard will be “released in a way that allows suppliers across the industry access to provide more charging options for EV drivers.”
From early 2024, Ford and GM EV owners will be able to purchase adapters to connect to Tesla fast chargers. In 2025, both companies plan to sell vehicles designed for Tesla’s North American plug. Owners need an adapter to connect to CCS chargers.
By working with an arch-rival, Ford and GM have acknowledged they need Tesla’s network to sell electric vehicles.
“Reliable, ubiquitous public charging is a key factor in increasing electric vehicle adoption,” Ford CEO Jim Farley said in an email when the company announced its agreement with Tesla last month. “The Tesla Supercharger network has proven to be reliable and has already established charging corridors in the US and Canada.”