Elon Musk's decision to gut Tesla's electric vehicle charging team is scrambling plans for rolling out new fast-charging stations and may delay US President Joe Biden's efforts to electrify the nation's highways.
In 2023, the Biden administration announced rules for an ambitious plan to expand the country's charging infrastructure and jump-start EV adoption. Under the National Electric Vehicle Infrastructure program, the government is doling out $5 billion to states over five years to build 500,000 public EV chargers.
EV market leader Tesla, which operates the largest network of fast chargers — called Superchargers — in the US and is the biggest winner of those federal funds so far, was seen as a crucial part of that plan.
Since news of Tesla's abrupt EV charging layoffs surfaced, however, executives at charging companies say they have been receiving phone calls from landlords looking for a new partner for their private charging projects after Tesla pulled out.
Now, the charging companies are preparing for Tesla to pull out of the federal program. That, they say, could throw a spanner into an already slow rollout.
"It's going to delay NEVI rollout. There's no question about it," said Aatish Patel, co-founder of XCharge North America, which makes EV chargers for fleets and charging station operators.
If Tesla backs out, then the solicitation by states for NEVI-funded charging projects starts over, he said. "A lot of these sites aren't going to get built this year, or within the time frames that were initially dictated."
Patel said real estate companies representing about 10 non-NEVI sites in Texas, Louisiana and New York had called since news of the layoffs, saying that Tesla was pulling out and they were looking for a replacement.
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Tesla won awards to build chargers for 69 of the 501 NEVI-funded sites announced so far, according to San Francisco-based research firm EVAdoption.
"I'm speaking to any NEVI sites they've been awarded. They're not going to move forward on those," Brendan Jones, CEO of Blink Charging, said. Blink has received three inquiries in two states about multiple private sites where Tesla has backed out since the layoffs, he said.
Rollout of the federal program has been sluggish. Long-awaited rules on eligibility for federal funds were finally laid out in early 2023. Only a handful of federally funded charging stations have been opened to the public.
Since the layoffs, Musk posted on his social media platform X that Tesla plans "to grow the Supercharger network, just at a slower pace for new locations and more focus on 100 percent uptime and expansion of existing locations".
He did not respond to questions from Reuters on the implications of his decision. In a subsequent post earlier this month, Musk said Tesla will spend more than $500 million to expand its fast-charging network this year.
A spokesperson for the federal Joint Office of Energy and Transportation, which oversees the NEVI program, said in an email it does not expect individual business decisions to affect EV charging projects funded by the government.
States that awarded Tesla NEVI sites are closely monitoring the situation.
Colorado will adjust its program as needed, said Kay Kelly, chief of innovative mobility for the Colorado Department of Transportation. Texas — the biggest beneficiary of NEVI funds — said it does not anticipate any effect from Tesla's layoffs.
Tesla's change of plans, however, will affect the entire EV industry. Almost all automakers decided in 2023 to adopt Tesla's North American Charging Standard for their vehicles from 2025. That could provide a silver lining for other charging startups — and recently laid-off Tesla employees.
"There will be a lot more NEVI sites available if Tesla backs out of projects they have already won, or withdraw their applications," Rick Wilmer, CEO of charging company ChargePoint, said. "It will be an opportunity for others to jump in and fill that void."
Rivals like EVgo are looking to hire those let go by Musk. "If you were impacted by the recent Tesla layoffs, we invite you to explore EVgo's diverse range of job openings," a talent acquisition manager at the charging company said in a post on LinkedIn.
