Speculators who bet against Tesla are down more than $6 billion since the electric vehicle maker’s share price surged on charging deals with Ford and GM, according to S3 Partners, which keeps score on these things.
Between last August and early January 2023, betting against Tesla looked like a smart idea. Indeed, Tesla is the No. 1 shorted stock in the world.
And why not? On paper, Tesla is a niche manufacturer under growing competitive pressure. Elon Musk was busy at Twitter and the narrative (including here) was that Tesla was becoming just like any other automaker, forced to cut prices to keep assembly lines rolling.
Tesla’s shares fell 67% between August 2022 and January 2023. Even a showy “Investor Day” did not help that much.
That was then. Since May 24, the day before Ford said it would adopt Tesla’s North American Charging Standard, Tesla shares have soared by roughly 35%. Tesla has added nearly four General Motors’ worth of value to its market cap as analysts declared Tesla had won the North American charging standard war.
Charging networks Blink and Chargepoint reinforced that narrative Monday, saying they will include Tesla NACS connectors on future charging stations.
As Breakingviews writes, Wall Street loves the charging deals for Tesla – and for the legacy automakers, despite the risks. Piper Sandler analyst Alexander Potter estimated revenue from non-Tesla owners using the Tesla Supercharger network could add $3 billion to Tesla’s 2030 revenue – nice, but not that much compared to the $700 billion in annual revenue PSC expects for Tesla within a decade.
The charging deals help Tesla in Washington, too.
The White House said on Friday that Tesla’s new alliances to open its network could qualify the company for subsidies meant to build out U.S EV charging. It was the first time the Biden Administration had explicitly connected Tesla to its $7.5 billion charging buildout plan.