Lucid Motors (NASDAQ:LCID) stock rose 6.5% on Feb. 15 and kept rising overnight as President Joe Biden’s administration pushes for more electric vehicle (EV) charging stations, and for compatibility among fast charging systems.
As part of the effort, Tesla (NASDAQ:TSLA) said it will make 7,500 of its stations available to other electric car brands by the end of 2024.
Lucid stock is up 78% in 2023 on the strength of its cars’ driving range and support from the Saudi government. Shares are due to open on Feb. 16 at $11.08 each, representing a market capitalization of $20 billion. Tesla’s value has nearly doubled this year.
LCID Stock Gets Supercharged
Tesla has a proprietary charging system it calls the North American Charging Standard (NACS). NACS is incompatible with the Combined Charging System (CCS) used by other vehicles and by third-party charging systems like ChargePoint (NASDAQ:CHPT).
The Biden administration now says all new charging stations must be compatible with CCS. It also wants stations built with help from the government to support DC Fast, a 480-volt system that can give most cars a full charge in about 20 minutes. Tesla Superchargers run at 480 volts.
A shortage of charging stations has made many Americans reluctant to buy EVs. The lack of compatibility has made some reluctant to consider electrics other than Tesla. The demand for standards is important because mid-market electrics, like the General Motors (NYSE:GM) Chevy Bolt, can only run about 250 miles per charge. Cars like the Lucid Air Dream Edition can get twice that range. Most new gas-powered cars stop for gas every 300-400 miles, but a gasoline fill-up takes less than five minutes.
GM recently made a deal with Pilot Flying J, in which Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) has a major stake, to install electric chargers at its travel centers. This latest move from the Biden administration will help make these compatible with what Tesla is offering.
What Happens Next?
Charging has been the main pain point for EV adoption in the U.S. By demanding compatibility, the government is helping both Tesla and its competitors.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.