Tesla’s Supercharger network, once regarded as non-profit, is now expected to transform into a substantial revenue stream. Analyst Dan Ives from Wedbush Securities foresees remarkable growth potential, projecting a value of $10 to $20 billion by 2030.
Supercharger Network
Ives attributes this projection to several key factors, including Tesla’s North American Charging Standard (NACS) agreement with fellow automakers, strategic investments in artificial intelligence, expanding production capabilities, and the company’s energy business.
Wedbush’s Dan Ives reiterated an Outperform rating and $350 PT on $TSLA! ⚡️🎯 https://t.co/6xg6SP0ISl #Tesla #EV pic.twitter.com/TgMQEymkaI
— Tesla New York (@TeslaNY) August 25, 2023
North American Charging Standard
Positioned advantageously for the electric vehicle (EV) transition, Tesla continues to experience robust global demand for its EVs, aided by recent price reductions. Ives’ positive outlook on the stock sets a target price of $350.
CEO Elon Musk’s readiness to further slash prices in response to potential market turbulence has been evident, as Tesla has already decreased model prices multiple times within the same year.
Automotive Industry
Tesla’s historical approach involved offering free unlimited supercharging as an incentive, though this was ultimately discontinued due to sustainability concerns. However, remnants of this program remain, benefiting both older Tesla models and vehicles under temporary deals.
Model 3
Current offerings include incentives for Model 3 customers, such as three months of complimentary unlimited supercharging for orders placed during specific promotional periods.
The automotive industry is also undergoing a transformation as several major manufacturers, including Ford, General Motors, Mercedes-Benz, Honda, Volvo, and Nissan, have adopted Tesla’s North American Charging Standard, further solidifying its significance.
Here are some additional factors that could contribute to the growth of Tesla’s Supercharger business:
- The increasing popularity of electric vehicles. As more and more people switch to EVs, the demand for charging infrastructure will increase. Tesla’s Supercharger network is well-positioned to meet this demand.
- Government incentives. Governments around the world are providing incentives for the development of charging infrastructure. This could help to accelerate the growth of Tesla’s Supercharger network.
- Technological advancements. The development of new charging technologies could make it more convenient and affordable to charge EVs. This could also boost the demand for Tesla’s Supercharger network.
Tesla’s unique business model charges customers for using its Superchargers, setting the stage for significant revenue generation, particularly as the industry-wide adoption of Tesla’s NACS connector expands.
Conclusion
In summary, Tesla’s Supercharger network is set to evolve into a multi-billion dollar enterprise, driven by strategic partnerships, increasing demand for EVs, and the innovative business model that underpins it.
