In the European and American markets, companies operating electric vehicle charging stations are competing for prime locations to deploy public fast charging stations. Industry observers believe that as more large investors join the competition, the charging pile industry will usher in a new round of consolidation.
Currently, many companies operating public charging stations have received support from long-term investors, and it is expected that there will be more similar companies in the future. Fuel powered vehicle bans are about to be introduced around the world, making the charging station industry more favored by many infrastructure equity investors.
Tomi Ristimaki, CEO of Kempower, a Finnish electric vehicle charging station manufacturer, said, "If you carefully observe our customers, it's like a land grabbing campaign right now. Whoever gets the best position now can guarantee electricity sales performance for the next few years."
An analysis shows that there are currently over 900 companies operating electric vehicle charging stations worldwide. According to research firm PitchBook, the charging pile industry has attracted over $12 billion in venture capital since 2012.
ChargePoint is one of the largest suppliers of electric vehicle charging equipment facilities and software. Michael Hughes, the company's Chief Revenue Officer and Chief Business Officer, stated that "the outlook for the fast charging pile industry will be vastly different from what it is now, as large investors provide funding for more integration."
Companies such as Volkswagen, BP, and EA are investing heavily in the charging station industry. Since 2017, the entire industry has conducted 85 acquisition transactions.
There are over 30 fast charging station operators in the UK alone, and two new companies were established in this industry last month. One of them is Jolt, an Australian company supported by BlackRock Infrastructure Fund, and the other is Zapgo, which received £ 25 million (approximately $31.4 million) in investment from Canadian pension fund OPTrust.
Lauren McDonald, CEO of EVAdoption, a research company headquartered in San Francisco, said that Tesla is the largest player in the US market, but more convenience stores and gas stations will be rapidly entering the market, and the number of fast charging networks in the US will increase from 25 in 2022 to 54 by 2030.
Based on a utilization rate of around 15%, it may take four years for a properly located electric vehicle charging station to achieve profitability. The companies operating charging stations complain that the cumbersome regulatory procedures in Europe are affecting their business expansion. However, the charging station industry is still considered a good investment target by long-term infrastructure investors such as Infracapital. Infracapital owns Recharge, a charging network in Norway, and has also invested in Gridserve in the UK.
Christopher Bordes, Managing Director of Infracapital, said, "It is absolutely reasonable to make long-term investments in (charging pile companies) at the right locations."
Hughes of ChargePoint believes that larger participants will start looking for new locations outside of existing venues that can accommodate 20 to 30 fast charging stations, various retailers, and facilities.
"This is a space grabbing competition," he said, "but the time to find, build, and activate these new sites is longer than anyone expected."
The competition for the best site is becoming increasingly fierce. Before determining the winner, the site hosting party can often switch back and forth between charging station operators.
Brendan Jones, CEO of Blink Charging, said, "We like to say that when you communicate with the site hosting party, no transaction is dead."
Many companies operating charging stations are also rushing to sign exclusive contracts with landlords.
For example, InstaVolt, a subsidiary of Yintuo Group in the UK, has reached an agreement with fast food chains such as McDonald's to set up charging stations in the McDonald's store area.
"If you can win a partnership, then unless you mess it up yourself, it will always be yours," said Adrian Keen, CEO of InstaVolt
Keane stated that with the "strong financial" support of Yintuo Group, InstaVolt plans to install 10000 charging stations locally in the UK by 2030 and conduct business in Iceland, Spain, and Portugal. He added that integration may begin around next year.
Keane said, "This may open up more opportunities in the market we are in and also open the door to new markets for us."
The charging station department of EnBW, a German utility company, has 3500 electric vehicle charging stations in Germany, accounting for approximately 20% of the German market. The company invests 200 million euros (215 million US dollars) annually and plans to deploy 30000 charging stations by 2030, relying on local employees to compete for more charging stations.
Lars Walch, the vice president responsible for sales in Germany, said that the company has also established charging network partnerships in Austria, the Czech Republic, and northern Italy.
Woqi stated that although integration is imminent, there is still room for multiple operators to coexist.
Recharge CEO Hakon Vist said that Norway is the world's leading electric vehicle market, but due to companies competing to deploy charging piles, the Norwegian market has been affected by "over deployment" in the short term this year. 2000 new charging stations have been added locally, bringing the total to 7200. But as of October this year, sales of electric vehicles in Norway have decreased by 2.7%.
Recharge has a market share of approximately 20% in the Norwegian charging pile market, second only to Tesla.
"Some companies may find themselves too small to meet customer needs and leave or sell," West said.
Some people are also starting companies, knowing that they can acquire others and that they can be acquired.
After entering the UK market with the support of OPTrust, Zapgo plans to target underserved areas in the southwest of England and pay a portion of its income to landlords in order to obtain good locations. Zappo CEO Steve Leighton stated that the company plans to deploy 4000 charging stations by 2030. He predicts that integration will be a financial issue until later this decade.
Leighton said, "The most financially strong investors will be responsible for integration." He also said that OPTrust "has a large scale, but there may still be a large infrastructure fund that hopes to acquire Zapgo at some point."
McDonnell of EVAdoption said that as convenience stores such as CircleK and Pilot Company and retail giants such as Wal Mart invest heavily in charging stations, the US market will also change.
"Just like all industries created by a group of small companies, over time, big companies will join in... they will integrate." McDonald said, "At the end of this decade, the companies left on the market will be completely different."