Electric Vehicle (EV) Charging Infrastructure Market

Global Industry Analysis (2017 – 2020) – Growth Trends and Market Forecast (2021 – 2025)

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Electric Vehicle (EV) Charging Infrastructure Thrives with Eco-friendly Regulatory Reforms

The International Energy Agency in its Global EV Outlook Report has highlighted that sales of electric cars topped 2.1 million globally in 2019 and electric cars account for 2.6% of global car sales. With such a manifold increase in the sales of electric vehicles, the electric vehicle (EV) charging infrastructure is also set for a significant rise in the near future. Moreover, a recent report from National Renewable Energy Laboratory reveals that the public electric vehicle supply equipment grew at about 7.6% within a matter of three months in 2020, which is again a strong factor supporting the growth of EV charging infrastructure market.

Concerns regarding the reduction of carbon emissions and policies towards carbon neutrality are pushing governments across the globe towards creating prudent policy frameworks in addition to announcements of favourable subsidies. This is expected to be significantly responsible for the rise of EV battery sales as well as a boost to EV charging infrastructure market. E.g., the European Union (EU) has approved certain policies in this regard like the fuel standards for trucks and cars and Clean Vehicle Directives for procurement of electric buses.

Similarly, the French government has also announced that people will be eligible to receive 12000 euros as an incentive for purchasing electric vehicles. Besides other countries such as India, the US, France, and the Netherlands have introduced policies that would encourage electric vehicle sales, thereby pushing the market potential of the charging infrastructure for electric vehicles.

Reduced Costs to be Paid at Charging Stations Support Expansion of EV Charging Infrastructure

According to research, both hardware and installation costs for charging stations have dropped by 50% from 2011 to 2013, which is attributable to growing preference for dual chargers over one charger per pedestal. This has helped manufacturers to adapt to a viable business model and thereby create favourable environment for expansion of electric vehicle charging infrastructure market. Moreover, with time, more and more companies from different industrial backgrounds are trying to enter the market for EV charging infrastructure, looking at the flourishing prospects over the recent past.

Compatibility Challenges Still a Threat to Rapid Expansion of EV Charging Infrastructure

Currently, due to various plugs and outlets, all EV models are not compatible to plug in at all charging stations. Each charging station is associated with a specific type of network, which would continue to be among the key limitations for charging stations meant for electric vehicles. This, however, may remain a major impediment that would keep adding to the reluctance of a sizeable number of consumers regarding purchasing electric cars. Moreover, the lack of interoperability between charging stations will be among the major restraining factors holding the expansion of EV charging infrastructure market back.

Fast Chargers in Demand; Expensive Pricing Hampers Sale

The fast-charging infrastructure saw a major rise due to the high demand for fast chargers in commercial stations. Amidst a remarkably reduced cost structure of charging stations, there has been greater demand for fast EV chargers or more popularly, superchargers. However, such fast chargers like Chademo come with a premium price tag, and the installation costs in the US can range anywhere from $4000 to as high as $51000.

Such an expensive price point will be the key factor affecting the overall EV charging infrastructure in the near future. Most organisations are installing Level 1 DC fast chargers and Level 2 AC charging stations, which is fuelling the growth for fast chargers. The slow charger segment is also set to rise due to its increased deployment at public as well as residential charging stations.

Targeted Government Policies Position Asia Pacific as EV Charging Infrastructure Hub

According to market estimates, Asia Pacific is set to account for a major revenue share in global EV charging infrastructure due to favourable government policies in fast developing economies such as China, India, and Japan encouraging investments in charging infrastructure development. E.g., in Japan, the electric charging stations are far greater in number than petrol pumps, which signifies the significance of EV adoption in the country. About 39000 new electric vehicles were sold in Japan in 2019.

India also has announced its EV plans where they aim to have about 1,000,000 EVs by 2024, according to reports by NRDC (National Research Development Corporation). Some of the European countries such as the UK, France, and Belgium are also focussing on improved interoperability of EVs throughout the region.

COVID-19 Impact on EVs and Charging Stations

The global COVID-19 pandemic held a massive impact on automotive industry, leading to massive losses for almost a year. This significantly deterred the momentum of electric vehicle production and sales, in turn, hampering the developments in EV charging infrastructure. Logistical and supply constraints especially played out as the biggest hurdles.

Due to the COVID-19 pandemic, the global automobile industry has faced huge losses, this has also impacted the production of EV; hence its domino effect will also be seen in the expansion of the charging infrastructure market as the logistical issue becomes an important concern. However, despite this situation, the market in Europe saw heightening sales of electric passenger cars, thereby overtaking EV sales China.

Key Market Players Collaborating for Strategic Expansion

The key market players are prioritizing consolidation of their market shares in EV charging infrastructure market, mainly through strategic M&A. E.g., ChargePoint has collaborated with BMW Inc, Volkswagen Inc for setting up fast chargers across the west coasts of the USA. Similarly, other prominent players like AeroVironment, Inc, BP Chargemaster, ABB are also focusing on such strategies to improve their market positions in this huge potential market.

Even automotive giants, including Volkswagen Group, BMW Group, and General Motors are also investing in charging infrastructure like to cut down their fleet emissions. Also, collaborations are happening between manufacturers and car rental service providers such as Eaton Corp who has recently collaborated with Green Motion car rental services for integrating chargers into buildings with energy storage. Such collaborations and investments are resulting in greater expansion of charging infrastructure.

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