(Bloomberg) — General Motors Co.’s move to adapt its electric cars to use Tesla Inc. From Superchargers to staggering stock to other makers of EV charging stations.
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EVgo Inc sank 12% on Friday, its worst day in nearly a month. ChargePoint Holdings, Inc. stock fell. down 13%, and Blink Charging fell 11% for its biggest daily loss since February. Beam Global, which designs clean energy systems for charging electric vehicles, fell 4.9%.
General Motors is the second largest automaker that says it will use Tesla’s charging network. Ford Motor Company announced a similar move in May. Tesla rose 4.1% on Friday, extending its $200 billion rally for an eleventh day, while General Motors gained 1.1%.
While the agreement burdens other electric vehicle chargers, the market may have overreacted, according to some on Wall Street.
“We think the news is exaggerated, although we acknowledge that the news calls into question what GM plans long-term with EVgo, which has been one of its main shipping partners,” JPMorgan analyst Bill Peterson wrote in a note.
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JPMorgan continues to see the over-rated ChargePoint as well-positioned to benefit in areas where Tesla doesn’t compete, such as business, multiple families, and fleet. They’re less clear about the long-term direction of EVgo, but said the company still has important partnerships with other electric vehicle makers including Toyota Motor Corp. and Subaru Corp. – Faceted approach to the future. JPMorgan has a neutral rating on EVgo.
Bank of America agrees that the news is more uncertain for EVgo, which has an underperforming rating, even though GM has outlined continued commitment to its eXtend business.
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“We expect investors to be uncomfortable about the competition because it now has another major partner,” Bank of America analyst Alex Vrabel said in a note. “In a more direct sense, because it is the host of the site, EVgo will now compete more directly for use against TSLA’s highly reliable network that serves a larger portion of its future EV fleet.”
That’s not an issue for hardware provider ChargePoint, as its network is largely fleet-focused, according to BofA, which reiterated the company’s Buy rating.
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