As the NACS connector becomes the North American standard, analysts are trying to determine how much of a charging advantage Tesla may have if it adopted the standard.
One of the industry’s foremost analysts has estimated that Tesla might be worth over $100 billion.
In North America, the Supercharger network is the most extensive and dependable fast-charging infrastructure for electric vehicles.
At first, Tesla only provided this as a courtesy to its customers; the company had no intention of turning it into a moneymaker.
It hasn’t been the case in the Americas.
To provide their EV customers with access to Tesla’s Supercharger network, automakers including GM and Ford have announced that they will be adopting Tesla’s NACS connector.
As a result, Tesla may come to control a sizable portion of the electric vehicle charging market, particularly in North America.
Adam Jonas, a senior Tesla analyst at Morgan Stanley, attempted to put a dollar amount on the potential value that Tesla’s charging business could bring to the company.
Jonas and his group think that eventually, Tesla will be able to generate and store enough solar energy to run its Superchargers independently. This assumption allowed them to construct several scenarios in which the proportion of US miles driven by electric vehicles in 2030, the market share of Superchargers providing the electricity to power those miles, the average efficiency of 4 miles per kWh, and the revenue of $0.32 per kWh would all vary.
They valued the outcomes at 20 times the net operating profit after tax for the fiscal year ending in 30 discounted at a weighted average cost of capital of 9.0%.
Based on those data, Seeking Alpha provides the following valuations for Tesla’s Supercharger network:
- Morgan Stanley’s “reasonable case” estimates a net present value of $3 per share for the company if conditions are met, such as a 10% penetration of EV miles, a 50% Tesla share of Supercharging, and a 30% net operating profit after tax margin.
- Morgan Stanley’s “plausible case” forecasts a net present value of $14 per share based on projections of 20% EV mile penetration, 70% Tesla share of Supercharging, and 50% NOPAT profit.
- Assuming 50% EV miles penetration, 100% Tesla share of Supercharging, and an 80% NOPAT margin, Morgan Stanley’s “monopoly case” calculates a possible net present value of $78 per share.
For $33 per share and an outstanding share count of more than 3 billion, the Supercharger network would be worth more than $100 million.
I agree that this research has some merit, but I also think that caution should be exercised when estimating the size of the Supercharger market.
It’s probable, in my opinion, that Tesla Supercharger will end up controlling the vast bulk of the DC fast-charging market.
Despite the hype surrounding DC fast charging, it’s crucial to remember that level 2 charging, especially at home and at the office, will continue to make up the vast majority of EV charging.
However, I anticipate that Tesla will soon be supplying hundreds of gigawatt-hours of charging through Superchargers each month, which will surely be a multibillion-dollar company.