The LA Times published an article recently which provides a more in-depth look at Tesla’s recent decision to end their referral rewards program.

Breitbart News reported earlier this week that Elon Musk announced via Twitter that Tesla’s referral program will end on February 1, urging customers to refer friends to buy a Tesla and give them six months of free Supercharging before the deadline. Now, the LA Times has published an article which provides a more in-depth look at Tesla’s decision to end this program and how it worked.

Musk previously stated that the program was being ended in order for Tesla to save money, the Times discussed this in their article stating:

In the program’s latest iteration, a Tesla owner sends a referral code to a potential buyer. When the car is sold, the buyer gets six months of free charging at Tesla-branded stations, while the owner earns a prize. Earlier programs offered free charging for life to original car owners; Tesla will honor existing arrangements.

Tesla turned positive on its cash flow in the third quarter of 2018. Its cash on hand seems enough to pay current bills but doesn’t come close to the billions of dollars needed to pay for Musk’s future projects, from an electric semitruck to a crossover vehicle to a new factory in China. At the end of the third quarter, Tesla reported about $3 billion in cash on hand. New issues of stock or bonds could provide the billions needed for growth, but for reasons he has not made clear, Musk said he does not need to tap the capital markets. It’s unclear how much money the end of the referral program will save. Tesla doesn’t break out the costs in its financial statements. But for a heavy user, it could total several hundred dollars — potentially adding up to tens of millions of dollars that Tesla could spend on other things.

One of the issues holding Tesla back has been their commitment to constructing Supercharger stations throughout the country, according to the Times:

“They’re kind of doomed by their own success” by achieving higher-volume Model 3 output, because construction of service centers and Supercharger stations are “not able to keep up,” said Mike Ramsey, auto industry analyst at Gartner.

The company promised 18,000 chargers at its U.S. stations by the end of 2018. The total reached only 11,400 by October, when Musk promised to double the capacity in 2019. Currently, Tesla has 1,422 stations with 12,011 chargers.