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Tesla withdraws from electric vehicle charging, growth of US network questionable | World affairs

Tesla’s abrupt decision to lay off its electric vehicle charging team and cut investment in public charging is a blow to the U.S. grid, which has long relied on Elon Musk to build the bulk of the country’s fast chargers .

The sudden layoffs this week left Tesla construction vendors unsure whether to continue with the charging projects they were building, although one supplier said the company has since confirmed that existing projects should continue.

Tesla owns and operates nearly two-thirds of the fast-charging ports in the United States and deploys more chargers annually than all other providers combined, according to data company EVAdoption. An unexpected Tesla withdrawal could undermine the Biden administration’s pledge to rapidly expand the U.S. network.

Many other automakers and companies are investing in charging in the U.S., but none so far on the scale Tesla was pursuing, analysts said.

“If Tesla slows down, these other companies will absorb some of the slowdown, but not all of it. Because Tesla simply uses charging stations at a different level,” says Loren McDonald, CEO of EVAdoption.

Asked about Tesla’s decision this week, White House press secretary Karine Jean-Pierre said more than 40 companies have announced new investments in charging infrastructure under the Biden administration. “This is an evolving and competitive market with several companies playing a leading role here. It’s not just one company,” she says.

The administration championed legislation in Congress that would provide $7.5 billion over five years to fund the construction of public charging stations. Tesla has secured funding for more locations than any other company (69 to date) and has secured approximately nine percent of the funding awarded to date, according to EVAdoption.

Tesla CEO Musk did not directly address the layoffs in a post on % uptime and expansion of existing locations. .”

Tesla did not respond to a request for comment and did not publicly confirm the layoffs, but several affected employees confirmed details.

In a post on social media, Lane Chaplin, a former employee of the charging unit, said he learned “in the middle of the night” that “the Tesla Charging organization no longer exists.” A former employee, who spoke to The Washington Post on condition of anonymity to discuss a sensitive matter, said about 500 people on the team had been laid off.

The former employee said the layoff notice arrived around 12:30 a.m. Pacific Time, while many employees were sleeping. Workers woke up to find their jobs had been eliminated.

“As part of our efforts to reduce costs and headcount globally, your position has unfortunately been eliminated,” the company email said. The former employee said the employees’ understanding was that Musk had met privately this week with Tesla’s senior director of EV charging, Rebecca Tinucci. A layoff of this magnitude would not have been Tinucci’s idea, the person said, adding that Tinucci was no longer with the company. Tinucci did not immediately respond to a request for comment.

A contractor who installs and maintains charging stations for Tesla said his team heard about the layoffs this week while on their way to a job site. A fired Tesla employee told the contractor that the workers should go home and that the company would be in touch, Andrés Pinter, co-CEO of Bullet EV Charging Solutions, said by phone. A flood of Bullet emails to Tesla contacts came back.

About 24 hours after the fired Tesla employee reached out, another division of Tesla reached out and assured Bullet that work would resume on active construction sites, and that “they plan to pay us for the work that we have done. said Pinter. Tesla also indicated it plans to move forward with sites it ordered from Bullet and where work has not yet begun, in Texas, California and Colorado, he said.

The news sows confusion over the deals Tesla has made to open up part of its charging network to drivers from other brands, including Ford, General Motors, Volkswagen and others. Tesla did this to qualify for part of the $7.5 billion in federal funding to build new chargers.

“If you suddenly fire the entire team, when GM, Stellantis or VW want to make Supercharging possible for their customers, there is no one at Tesla to keep the lights on,” said Sam Abuelsamid, a charging expert at Guidehouse insights .

American motorists say a lack of reliable public charging stations is one of the main factors keeping them from purchasing electric vehicles. Gabe Klein, who helps oversee the federal charging push as executive director of the Joint Office of Energy and Transportation, says the administration remains committed to its goal of building 500,000 public charging ports by 2030. There are 183,000 today, and Klein said providers are too. adding thousands every month.

One of the biggest new investors is Ionna, a consortium of seven automakers that plans to add 30,000 fast chargers in urban areas and along highways. With all the layoffs at Tesla, there is now a whole range of charging expertise available for other providers to tap into, says Nick Nigro, founder of Atlas Public Policy.

The Tesla layoffs come at a tumultuous time for the company, which is grappling with declining sales, fierce competition from China and general uncertainty about its business prospects. Last month, Tesla told employees it would cut 10% of its workforce globally, raising concerns about the prospects of a company considered a bellwether for the state of the EV market.

In its first-quarter earnings report last week, the company reported a steeper-than-expected 55 percent drop in profit, which Musk attributed largely to declining demand in the EV industry in general. Musk tried to calm investors by making a series of bold pledges, including a boosted production timeline of a more “affordable” car, doubling down on the creation of a fully autonomous robotaxi and outlining nearly $1 billion in cost savings from job cuts.

Musk told investors that he expects sales to recover later this year, and that he is confident that autonomous and electric vehicles will “eventually dominate the market.”

“In the future, petrol cars that are not autonomous will be like riding a horse and using a flip phone,” he said.

But the dramatic staff cuts have fueled skepticism about how the company will deliver on its ambitious promises. The cuts announced last month affected more than 14,000 employees in departments such as sales, technology and policy. More than 3,300 of those cuts occurred in California alone, according to state documents.