Tesla’s profitable Supercharger network is in limbo after Musk axed the entire team

At the start of the year, Tesla’s Supercharger team was tasked with the impossible. “We were on an exponential trajectory,” a former team member told TechCrunch, adding that the new goals were “super-duper crazy.” Despite the bottlenecks such expectations can create, “every time they raised the metric, we met it.”

Then one day in April, CEO Elon Musk axed the entire division, even though it was profitable last year.

With more than 25,000 charging ports in the US and over 50,000 worldwide, the Supercharger network is the undisputed king of EV fast charging. Widespread, well-maintained and fast, the grid has changed the way people view EVs, allaying concerns about range anxiety among large segments of the car-buying public. But with the recent layoffs, Musk cast a cloud over the private infrastructure project.

While some expected layoffs to hit the Supercharger division, few thought it would be eliminated.

“We built the best network in the world,” according to the former Tesla employee who spoke to TechCrunch. “We were watching the ship. Nothing was taken for granted.”

It wasn’t enough to save the team. Hundreds of people responsible for making a pin for the company suddenly left. This wipeout has industry watchers, shareholders and former Tesla employees wondering how it will affect EV owners and the company.

The auto industry has been hit hard recently, with sales not growing at their usual breakneck pace. Price cuts aimed at boosting sales weighed on profits, which fell 55% in the first quarter compared to the same period last year. With Tesla floundering, Musk made cuts — not with a scalpel, but with a chainsaw.

Tesla began downsizing, and the first round of layoffs wasn’t the last. The Supercharger section, approx 500 people strong, they were let go in a second wave that broke out at the end of April.

On Friday Musk he said that Tesla will spend $500 million to expand and upgrade its Supercharger network. But as insider knowledge shows, it will be difficult to achieve this goal without a team to oversee the work.

Before the layoffs, the Supercharger network looked poised to extend its lead over competitors.

One source explained that Tesla had improved Supercharger production and installation to the point where each slot could cost as little as $20,000 to install, less than half of its nearest competitor. A significantly more powerful version 4 of the Supercharger hardware, once poised for wider release, now appears to have stalled.

At the time of the layoffs, dozens of Supercharger locations were in various stages of planning and construction, according to insider information shared with TechCrunch. Some sites that were almost ready to open are either in limbo or may not open at all, the source said.

Tesla was previously in a strong position to win awards through the federally funded National Electric Vehicle Infrastructure (NEVI) program, which is set to disburse $5 billion to build a robust network of fast chargers nationwide.

The company had also focused its expansion plans on places with high demand, they added. Where the federal government was interested in improving coverage on a particular route and the demand had not yet materialized, Tesla’s policy team would prioritize NEVI funding for the location, according to the source.

“Everything was intentional. Everything had a goal,” a source told TechCrunch.

Often this meant building Superchargers in new locations, which are easier to deploy. Expanding existing ones is incredibly difficult, the source said, because leases must often be renegotiated, utility upgrades coordinated and existing infrastructure operational while continuing to serve existing customers. “Your cost per kiosk is exponentially higher than a new website.”

Analysts have long speculated that the Supercharger network could easily become a profit center, as Amazon did when it opened up its cloud services to other companies. But there, Tesla had Amazon beat: The Supercharger team was told the network was profitable, the source said, even before other automakers gained access.

How the Supercharger Network Was Created

Tesla opened the first Supercharger station in September 2012 as the first samples of the Model S hit the streets. Early models could deliver 100 kW, which was a large number at the time: CHAdeMO, a competing standard used by the Nissan Leaf, had a maximum output of 62.5 kW at the time, and the Combined Charging System (CCS) was still in the prototype phase.

The first stations opened in California, and soon more began to spring up along highways on the East Coast, then in the Midwest and Texas. Within a year, the company upgraded the equipment, increasing the maximum power to 120 kW. And within three years, Tesla had a network that covered the US, making coast-to-coast electrification possible. As the company entered Europe, China and other countries, it added Superchargers there as well. Today, the network supports nearly 60,000 charging stations on four continents.

Why the Supercharger network is considered the best

In the early years, Tesla Model S and X owners enjoyed unlimited charging at gas stations — an incentive designed to attract new customers. When the Model 3 was released, the company began charging new owners for charging sessions, though the process was much easier than what competitors offered. Drivers simply had to plug in the car and Tesla would charge a credit card on file.

Today’s Supercharger slots support charging speeds of up to 250 kW. Other networks exceed 350 kW, but are not as reliable. Tesla says so network uptime is 99.95%, much better than its competitors. Real-world usage suggests that’s not far from the truth: A University of California-Berkeley survey of EV drivers in the San Francisco Bay Area found that while 25% of non-Tesla drivers experienced major problems with their public chargers, only 4% of Tesla drivers made it to Superchargers.

Can other EVs use turbochargers?

For over a decade, Superchargers were only available to Tesla owners. Because charging sessions had to be initiated with a handshake between the vehicle and the charger, and because billing was done behind the scenes, Tesla had tight control over who could use them. The company’s proprietary plug design didn’t hurt either.

That began to change in the fall of 2022, when the company made the plug’s design details available to other automakers. (At that point, Tesla was already using the same communication protocol as CCS when charging.) Then, in May 2023, Ford announced that it would adopt Tesla’s plug design, known as the North American Charging Standard, and that its customers would have access to 12,000 Superchargers across the US and Canada. Soon, the floodgates opened and GM, Rivian, Volvo and others followed suit. Today, all major automakers selling in the US have adopted NACS.

These are all the major brands that have announced NACS adoption for future EVs:

In February, Tesla began providing access to automakers. Ford was the first to gain entry, and the company began offering existing EV owners free adapters for a limited time.

What’s next for the Supercharger network?

Nobody really knows. With future Supercharger sites up for grabs, it’s possible the network has reached its zenith, at least for now. Musk said expansion into new locations would continue “at a slower pace” and that the focus would be “on 100% uptime and expansion of existing locations.” Without a team, all of this will be challenging, especially working on existing sites, which are more complex endeavors.