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Economics around superchargers

Discussion in 'TSLA Investor Discussions' started by chiller, Jul 4, 2018.

  1. chiller

    chiller Member

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    Location:
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    Has anyone done any analysis about their supercharger network now that people have started paying to use it? Will tesla be able to (or even want to) make a profit?

    Here in Norway they charge around 40% higher price than what you would normally pay for that same power at home but I am unsure if it is possible to get a cheaper price as a big buyer.
     
  2. cpa

    cpa Active Member

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    I do not think that Tesla discloses its Supercharger revenues (immaterial) or costs (also immaterial) with perhaps excepting the fixed asset costs with building out new or expanded locations as a part of their capital expenditures each reporting period.

    Here in the good ole US of A, utilities bill commercial and industrial customers not only for the electricity delivered but also for "demand charges." These demand charges take the highest electricity draw in kilowatts for any 10 or 15 minute period during the billing cycle and multiplies that amount by anywhere from $10-$30 per kW. A ten-stall station could be sucking 600+kW at one moment in time. I do not believe that domestic utilities offer quantity discounts.

    Then, we need to factor in all the period costs with maintaining and repairing these locations. Cables wear out. Stalls are damaged. The charger stack and electronics poop out. The distances that need to be covered by the technicians can be hundreds, if not thousands of miles. Those labor costs are not cheap.

    This is my opinion, but I would be surprised that even with the advent of paid Supercharging that five years down the road, Tesla even covers half the operating costs (forget depreciation; just cash outlay) of their Supercharger network.
     
  3. ewoodrick

    ewoodrick Active Member

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    Don't forget that when calculating the cost of home charging, to include the cost of your infrastructure.

    I don't think that Tesla expects the Superchargers to ever be profitable. I suspect that the new "non-free" concept is just to provide some investment to help expand the existing network. Don't forget, the 40% additional cost has to include billing, which may be as much as 6% for credit cards.
     
  4. J X 3

    J X 3 Member

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    Overall they seem to be charging around twice the retail electricity prices while industrial electricity costs about half of retail and generating your own can be substantially cheaper.
    So they really need to work on this and get prices in line with retail or folks will start avoiding the Superchargers as alternatives appear.
    I got no data to figure out costs for the infrastructure but one thing is for certain, going forward the cost per car served will keep dropping as charging times improve. Going from 10kWh to 50kWh takes 20-30 minutes today (depending on model) so it's gonna be quite costly but in 10 years it might take 3 minutes. This is the best way to expand capacity , improve charging rates. The faster the charging , the higher % of the total miles they capture too, assuming they sort out pricing so it could become substantial in the longer run if they keep investing in the network and turn it into a business - no point to keep investing without making a profit if there are sufficient alternatives.

    In Norway in 2017 household consumers payed 0.16 euros per kWh while non-household payed 0.07 euros.
    http://ec.europa.eu/eurostat/statistics-explained/images/7/7d/Electricity_prices%2C_Second_semester_of_2015-2017_%28EUR_per_kWh%29.png
     
  5. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    Ithaca, NY, USA
    The reason the Superchargers are now not-free is basically to deter extreme overuse. For some reason if something is free some people will camp out and use it as much as possible. Pricing Superchargers above home prices is designed to make sure people will only use them on road trips, which reduces demand to a reasonable level.

    The ongoing cost of the Superchargers is mostly charged to the marketing budget (an interesting fact).
     
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