Seven major automakers on Wednesday said they were forming a new company to provide electric vehicle charging in the U.S., in a challenge to Tesla and a bid to take advantage of Biden administration subsidies.
The group includes General Motors, Stellantis, Hyundai Motor and its Kia affiliate, Honda , BMW and Mercedes Benz – brands representing about half of U.S. vehicle sales but a small share of the EV market dominated by Tesla.
The unusual coalition of competitors – that according to some lawyers might raise antitrust concerns – said the new joint-venture aims to roll out 30,000 chargers in North America, starting along major highways and in cities.
The automakers did not specify how much they would invest individually or collectively, but said they would be open to additional investment or participation from other companies, including outside the auto industry. A name for the venture was not announced.
“The investment will be far less through this partnership than building individual charging networks,” said Akshay Singh, a partner at consultancy PwC Strategy&. “They also get to control the customer experience and collect data.”
There are more than 30,000 fast-charging machines around the nation. Each can cost anywhere from less than $100,000 to more than $200,000 for the most powerful versions.
Industry executives familiar with the cost of chargers said establishing this venture could cost multiple billions of dollars.
“We think this is an important step forward,” White House press secretary Karine Jean-Pierre said. “It’s creating new union jobs for installation and maintenance.
The Biden administration has set a target of hitting 500,000 chargers by 2030, an almost four-fold increase. Tesla, which accounted for more than 60% of U.S. EV sales last year, has the largest network of fast-chargers with almost 18,000 Superchargers.
Tesla said earlier this year it would open part of that charging network to EVs from rivals in order to be eligible for a share of funding from $7.5 billion in federal subsidies.