By Michael Elkins
An exclusive story by Reuters reports today, citing administration officials, that the Department of Transportation is expected to finalize a requirement next week that will pressure Tesla (NASDAQ:TSLA) to expand beyond its proprietary charging equipment in the U.S. and add the charger used by its competitors.
Tesla CEO, Elon Musk has previously talked about the possibility of opening the company’s Supercharging network to competitors, but has yet to do so in the United States. However, if the requirements are finalized and Tesla still refuses, the auto maker will be left out of the $7.5 billion in subsidies flowing out of Washington as President Joe Biden plans to “blanket the nation” with 500,000 EV chargers in the coming years, up from 100,000 in 2021.
The charging network is essential to the president's plans to combat climate change by converting 50% of all new U.S. vehicle sales to electric by 2030. Advocates of the plan claim the current lack of chargers on U.S. roads has slowed the growth of EV sales and the positive environmental impact.
According to White House infrastructure czar Mitch Landrieu, when Musk met with White House officials last month in Washington D.C., among the items discussed was the EV charging program. The multi-billionaire CEO has not publicly discussed plans for U.S. market changes. However, during the July 2021 earnings call, Musk said that “the point of Tesla's charging network was "not to create a walled garden and use that to bludgeon our competitors."
Musk has yet to comment on the ensuing requirements but state officials are optimistic.
"We do understand that Tesla is looking to tweak their system to be more open access. So, if they do reach that point and meet those eligibility requirements, they certainly will be eligible for funding," said Stuart Anderson, the state of Iowa's Transportation Development Division Director.
The move to finalize the so-called 'minimum standards' by the administration is expected to free the first wave of funding and set off fierce competition among companies like ChargePoint Holdings Inc (NYSE:CHPT) and EVgo Inc (NASDAQ:EVGO) Any charger that wants to be eligible for federal dollars will have to meet the CCS standard once the rules are finalized next week, administration officials told Reuters.
Last year, in its letter to the FHA, Tesla proposed the idea that its Superchargers should qualify for rebates if they are co-located with CCS chargers that work with competitors.
An administration official told Reuters that request was not seriously considered.
Shares of TSLA are down 5.72% in mid-day trading on Friday.