Published on August 13th, 2015 | by Zachary Shahan186
Tesla Letter To “Frequent” Supercharger Users Ruffles Feathers & Raises Several Questions
August 13th, 2015 by Zachary Shahan
I just spent a few hours going through a thread on the Tesla Motors Club forum that is slightly more than one day old but already has over 300 posts. The thing that sparked the thread was a letter to “frequent” users of “local Superchargers,” but it seems there were some fundamental problems with the letter (or, to be specific, who received it), and it also raises some rather big questions.
Before I dive in, let me be up front about a few things before I am attacked and people start accusing me of shorting TSLA: 1) I’m long TSLA (and have no intention of changing that position any time soon), and 2) I’m criticized for being a Tesla fanboi far too frequently for my taste, even though I will happily admit that I am indeed a Tesla fanboi. Got that?
As a little more historical context on Tesla’s side, though, let me also direct you to the statement starting at 8 minutes and 11 seconds into a 2011 video interview with Kurt Kelty, Tesla’s director of battery technology from 2006 to the present day. (By the way, Kurt does a pretty dang good job staying out of the limelight while holding a critical role at Tesla for nearly a decade, doesn’t he?!) The full interview is embedded at the bottom of this article if you want to watch the whole thing, but this is the line: “You often hear about this chicken-and-egg syndrome where ‘we can’t really have the EVs out there until we get the charging infrastructure in place,’ but we don’t believe that at all because our customers I mentioned earlier, they’re charging at home. We don’t need a charging infrastructure throughout the country. The only place we need that infrastructure is probably on major corridors, say between LA and San Francisco — you want some charging stations there — but, in general, our customers are happy charging at home, they have their charger in their garage, and it works very smoothly.”
I imagine this statement has surprised many of you, and it surprised me when I heard it earlier this year. I’ve been planning to write a piece just about the statement and its implications ever since, but looks like I’m doing so here instead. One of Tesla’s huge competitive advantages is its Supercharger network. The way that it has been discussed in recent years by Elon Musk, JB Straubel, and most of us EV revolutionaries (as the network has grown by leaps and bounds to become a charging behemoth) is that it is a critical piece of the EV revolution that enables relatively fast and convenient long-distance travel when you need that, and that it also enables EV ownership for some of us living in apartments, condos, or other places where we cannot charge at home.
But the statement by Kurt was made before the Model S was even out, let alone any Superchargers. So, my take is that one of two things were at play there: 1) since there wasn’t Supercharging available, Tesla downplayed its importance, or 2) Tesla didn’t really think it was that important, and has since changed its stance…. Or perhaps it was a mixture.
I believe Elon has said that Superchargers were initially a test, and that they turned out to be more popular than he had expected. And that may well be the heart of the matter Tesla is facing today. The thing is, as Kurt discussed for a few minutes, electric cars are generally much more convenient than gasmobiles. You plug in when you get home, you unplug when you leave. It’s one of the biggest advantages of electric cars, as you hear over and over again from owners — they don’t have to waste time going to smelly gas stations. Even if you have to park on the street, places like Amsterdam are rolling out on-street charging stations on demand so that you can do the same. (Granted, we need a lot more places to be doing that.) So, to keep the accounting and technology simple, while being able to sell the Tesla Model S more effectively and with a feel-good feeling in their hearts, Tesla promoted free use of Superchargers for life. (Note, though, that some had to specifically fork over $2,000 for this, while it was fairly well known that it was “rolled into” the cost of cars where that wasn’t the case.)
Free Supercharging has enabled super convenient long-distance travel for people wanting to go on a road trip, visit grandma, take a vacation, etc. However, the assumption seemed to be that people would basically just use it for such purposes, and continue their even-more-convenient home charging for the large majority of charging. The assumption seemed to be that owners of high-end performance sedans wouldn’t abuse “free” charging. Sure, Homer Simpson might overindulge at the local all-you-can-eat buffet, but what upper-middle-class suburbanite is going to spend extra time charging in public to save a few bucks?
Well, as we have learned in recent months, some people have been abusing the system and charging more than Tesla would like (and many observers of human nature have predicted this would happen since Day 1). Elon noted in a conference call this year that some letters would go out reminding people that Superchargers are not meant for regular charging but for long-distance trips just to help you get to your next destination. That seemed simple enough, but something went wrong.
First of all, here’s a screenshot of one of the letters so you can read it in full and monitor your own initial reaction:
Seems simple enough. The problem is that users who Supercharge very infrequently and/or don’t even use “local” Superchargers have gotten the letter. For one of the recipients, for example, the nearest Supercharger was ~60 miles away. Some recipients of the letter hadn’t used a Supercharger in months. One of the recipients had only used the local Supercharger once. It’s not yet clear how many non-abusers got the letter. A handful of such people (presuming they are representing the situation accurately, of course), noted so in the forum. If the net was cast just slightly too wide, I guess it wouldn’t seem like that big of an issue, but given the charging activity of those people who had been singled out and chimed in to express their unhappiness over the matter, the implication is that it was cast far too wide for the language used in the letter.
There’s plenty of speculation regarding what went wrong, as well as what’s wrong in the accusatory tone of the letter, but my final guess is that it comes down to 1) somebody screwed up the underlying user segmentation or algorithm that was supposed to pick out abusers of the system, and/or 2) the people who worked on the algorithm didn’t communicate clearly to the people writing the letter that the net was cast very wide, and thus that the letter shouldn’t make recipients feel nervous about their warranted usage.
Clearly, many users are now feeling nervous. (Spend a few hours reading through the thread if you don’t believe me.) I won’t ramble down the path of the various theories about where things go from here, but as a TSLA investor and one of the most well known proponents of the EV revolution (which is clearly being driven by Tesla more than any other company), I will pick out a few issues that I think need to be addressed.
First of all, if Tesla’s accounting for Supercharging costs was off and something needs to be adjusted to curtail or pay for the charging, then I think Tesla needs to be a little more upfront about the matter, and needs to implement a clear transition in Supercharger communication and policy. Salespeople have apparently changed how they discuss Supercharging with new buyers (emphasizing that it is for long trips), but perhaps it is time to say that free Supercharging for life has run its course and a new policy going forward will put a more appropriate price on the service (with current owners or reservation holders will be grandfathered/grandmothered in, of course).
If there isn’t actually a big underlying problem, and it was mostly a communications error (or even a simple mistake in the user segmentation or algorithm), given the responses so far, I still think Tesla needs to explicitly detail the issue it is facing (with solid numbers on cost, overuse of certain stations, abuse by Uber/taxi/commercial drivers, or whatever the matter is). Clearly, Tesla needs to deal with the communications error, wherever it stemmed, that led normal users of the system to feel attacked and singled out.
If this instance is part of a broader communication problem that really goes back to hyping of “free” Supercharging for life, then perhaps a deeper look at how things are presented and hyped is in order. For that matter, perhaps a deeper look at implementation of overly ambitious policies is also in order.Aside from this Supercharging issue, one owner messaged me that I should include discussion of the ranger and valet service that seems to have been quietly pulled/changed after initial promotion and fanfare. I think this person’s summary is better than my own would be:
In a nutshell, until recently Tesla had been touting the ranger service as the means for people who don’t live close to any service center to get service. (Many people had asked about this before purchasing.) The policy had been that ranger service would cost $100 maximum, and I believe that it would be provided for free if the issue was a warranty issue. (That’s what I had been told, and some others as well, but perhaps not everyone was told that it would be free under those circumstances.) Additionally, if the service could not be taken care of on site, the car would be trucked to the nearest service center, and trucked back, also at no charge, and with a loaner car provided, if needed.
For many people who live in areas a great distance from service centers, knowing we could get service, when needed, for at most a $100 fee, which at times would also include a loaner car, was the selling point that eased our minds enough to purchase a six-figure car, with no service available for hundreds of miles. Now Tesla has officially changed their policy, and is attempting to charge us $3.00 per mile one-way to valet our cars, or send a ranger. For me that would be over $600 every time I need something–including warranty work–done on my car, and of course it is more for others.
There is still a blog post, from Elon Musk, on the Tesla Motors website that promises the free valet service.
Of course, I wrote about that exciting service when Elon announced it (back in early 2013). I hadn’t heard much about it until this note, and I didn’t realize Tesla had slowly started charging a fee for the service. If Tesla realized it needed to start charging for this, it certainly seems like buyers up to the time of the change should have been grandfathered/grandmothered in, and that there should have been an explicit policy change.
Taking one step even further back, this is my broader take: Tesla is one of the best companies in the world, and that is largely because the people running the show (and many in the choir) have huge ambitions to improve the world. This, on the whole, is a big +. Combined with excellent knowledge, intelligence, empathy, social awareness, scientific methodology, cash, flexibility, vertical integration, and momentum, I don’t see anyone competing in this disruptive industry in the next few years at least, but probably a lot longer. This is why I am a big believer in Tesla, a big fan of Tesla, and a long-term investor in Tesla. However, the drive for outside-the-box and ambitious transformation also seems to come with a tendency to get too hopeful and too idealistic, and to promise too much. We perhaps see that most keenly when it comes to timelines, but I think also in some services, like the free Supercharging that assumes people won’t abuse the privilege.
Elon, JB, and I’m sure many others on the Tesla team are great at modifying and tweaking to improve technologies and systems, but Tesla is at a scale where these kinds of things need to be presented very openly, and it may also be at a scale where utopian services like not-so-cheap “free” Supercharging need to go. Of course, Tesla needs to grandfather/grandmother in the early adopters beforehand.
There’s a lot more to say, but maybe that’s enough for now. I’m sure others will usefully expand the conversation below.
Oh yeah, here’s that 2011 interview with Kurt Kelty: