The nascent electric vehicle industry has been at a crossroads regarding which charging system standard to follow. The recent decision by General Motors (GM) and Ford to team up with Tesla and use its Supercharger network for their vehicles looks to have tipped the scales decidedly in favor of the connector standard used by Tesla.
In recent years, there have been discussions about the adoption of a single standard so that all vehicles on North American roads can use any accessible charging point to top up battery power. Tesla has its own system, the NACS, and all its chargers adhere to this system. Other automakers in the EV space, such as GM, made chargers following another standard: the Combined Charging System (CCS).
The move to adopt one standard for the North American region makes plenty of sense. For one, establishing a charging infrastructure that conforms to one standard is more affordable than setting up charging units that have adaptors to enable different vehicle chargers to work at any charging point available. Additionally, consumers would be more willing to make the switch to EVs since issues of “being caught in the middle of nowhere” without a compatible charger wouldn’t arise.
Cognizant of the benefits of having one standard, the federal government threw its weight in support of the CCS standard since many automakers were using it for their vehicles. The government even went as far as mandating the use of this standard for those wanting to access some of the funding available through the Inflation Reduction Act to build out charging infrastructure.
However, CCS is not without its challenges, including technical glitches afflicting the chargers that use this standard as well as the limited availability of CCS charging stations. To put this in context, Tesla operates a network of approximately 19,400 charging stations within the United States, while all the other automakers following the CCS standard have a paltry 10,500 combined charging points. The CCS chargers aren’t only limited in number, but they are also plagued by technical challenges. In contrast, Tesla’s Superchargers are plentiful and offer a superior charging experience.
Now that GM as well as Ford have agreed to use Tesla’s chargers, the die seems to have been cast in favor of NACS, especially given that in this year’s Q1 report, the trio (Tesla, GM and Ford) accounted for 75% of EV sales countrywide. The federal government now faces a decision on whether to pivot to NACS or stick with the CCS standard, which seems to be falling out of favor given the recent industry development orchestrated by Tesla.
The same decision will also have to be pondered over by other startups such as Nikola Corporation (NASDAQ: NKLA) since their impact on the market could depend on the charging stations that consumers are able to use.
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