Tesla's Supercharger Network is a global leader in the EV charging market. Specifically, it's the most dominant across North America.
According to the latest estimates of an analyst, this alone could stack up a valuation that could exceed $100 billion.
Morgan Stanley's Adam Jonas his insights about this report highly the network's significance and competitiveness from every angle.
Tesla Supercharger Network's Growth
A Tesla, Inc. electric vehicle charges at supercharger location in Hawthorne, California, on August 9, 2022. - Elon Musk has sold nearly $7 billion worth of Tesla shares, according to legal filings published August 9, 2022, amid a high-stakes legal battle with Twitter over a $44 billion buyout deal.
Tesla's Supercharger network stands out as the only global EV fast-charging network, offering extensive coverage and reliability. Originally intended as a service to Tesla owners rather than a profit center, the company anticipated the growth of a robust EV charging industry.
However, this vision has not fully materialized in North America, leading other automakers like GM and Ford to adopt Tesla's NACS connector.
By doing so, these manufacturers aim to provide their EV buyers with access to the widely recognized and accessible Supercharger network, potentially positioning Tesla as a dominant force in the EV charging business, per Electrek.
Related Article: Tesla Expands Supercharger Network to Other Brands' EVs in Canada
Potential Value of Tesla's Supercharger Network
Adam Jonas and his team at Morgan Stanley have conducted a thorough analysis to estimate the value that Tesla's charging business could add to the company. Their long-term vision includes Tesla producing and storing its own solar electricity to power Superchargers.
Based on this assumption, they constructed various scenarios considering factors such as the percentage of US miles driven by electric vehicles in 2030, Tesla's market share of Supercharging, average efficiency, and revenue per kWh.
Valuations were then derived using a discounted net operating profit after tax (NOPAT) approach at a 9.0% weighted average cost of capital per Seeking Alpha.
"Reasonable Case":
- Assuming a 10% EV miles penetration, 50% Tesla share of Supercharging, and a 30% NOPAT margin, the potential net present value is estimated at $3 per share for the charging business.
"Plausible Case":
- With assumptions of 20% EV miles penetration, 70% Tesla share of Supercharging, and a 50% NOPAT margin, the potential net present value rises to $14 per share.
"Dominant Case":
- In a scenario where EV miles penetration reaches 30%, Tesla secures an 80% share of Supercharging, and the NOPAT margin stands at 70%, the estimated net present value amounts to $33 per share.
"Monopoly Case":
- Assuming an ambitious 50% EV miles penetration, complete Tesla dominance with a 100% Supercharging share, and an 80% NOPAT margin, the potential net present value soars to $78 per share.
Implications and Market Value of Tesla's EV Charging Network
Considering Tesla's outstanding share count of over 3 billion, a share price of $33 would put the Supercharger network on a pedestal with a valuation of over $100 billion.
It's important to note that these valuations are based on assumptions and projections. Real-world factors and market conditions can significantly influence the actual value realized by the Supercharger network.
Read Also: Tesla Implements Price Hike for Wall Connector with NACS
