Commentary on EV Industry Profitability Claims

< Back
May 24, 2021
September 9, 2022
9:30 pm
11:32 am
Electric Car Charging

Commentary on EV Industry Profitability Claims

Photo by Matti Blume

In a recent Driving.ca article titled “EV-Charging Industry is Doing Everything Except Making Money,” author David R. Baker makes a compelling argument that the EV infrastructure sector is a revenue desert, essentially incapable of generating enough cash flow to sustain profitability due to a lack of interest from motorists. “The dilemma boils down to demand,” he states, before adding that “lots of people still driving gasoline-powered cars won’t consider going electric until they see charging stations widely deployed.”

In many ways, he’s right. As of 2020, market share of EVs in the US stood at less than 2%. And while this is nearly triple what it was just five years prior, it still accounts for a small overall number of vehicles on American roads. Things like range anxiety and lack of available chargers have oft been cited by consumers as the top reasons for avoiding electric. The article goes on to share a number of facts and quotes from industry insiders that seem to back up the idea that the sector is operating in a sort of economic penumbra, with only minor bright spots in an otherwise shadowy fiscal wasteland.

The biggest claim is the lynchpin of the entire piece. “So far, none of the companies that deploy [charging] equipment has figured out how to make a profit,” Baker says in his opening salvo. This is where we beg to differ. Perhaps many of the companies interviewed have not yet established profitability, but we were able to achieve that milestone in our second year of operation thanks to a redefined business model, which, while acknowledging most of the facts Baker outlined therein, disputes the underlying premise to which they refer. Here are a few ways EVCS does car charging differently.

1.) Public/Private Partnerships

We treat municipalities and government agencies (think DOTs) like clients rather than mere regulatory bodies. Just like any private contractor performing work for the state, much of our funding comes from forward-thinking governments that see electric car charging as a way to increase local business and create cleaner air. This attracts new eco-conscious shoppers and residents, resulting in greater tax revenue. We have excelled at identifying myriad sources of state and federal funding dedicated to charger installation, which makes private property owners more inclined to become site hosts, thereby completing the triangular nature of our turnkey solution.

2.) Staying Lean

Our organization has managed to minimize many of the internal expenses that often weigh on balance sheets. Our CEO’s past experience in the space with Green Commuter has allowed for many valuable lessons in running a lean, efficient operation, and our CFO brings a wealth of knowledge in finance and accounting, particularly as it relates to start-ups. We have been able to outsource much of the cost-intensive work that indebts other organizations, like hardware manufacturing and the development of networking software, while using SaaS and other tech solutions to streamline internal processes.

Photo by Ivan Radic

3.) A New Business Model

While EV drivers are our ultimate focus, our business model begins with a B2B solution. We offer property owners a brand-new revenue stream with no upfront cost to them. We handle the site assessments, permitting, trenching, electrical work, installation and maintenance, while splitting each sale with the site hosts. However, unlike competitors, we don’t make or own chargers, which eliminates the costly endeavor of maintaining inventory. Nor do we “sell” charging stations, which involves massive sales efforts to convince reluctant business owners with already slim profit margins to invest in something that seems speculative, and offers no profit participation from charging.

4.) Measured Scaling

Many companies grew too big too fast. We started where the business was – namely California, with modest roll-outs in Oregon and Washington. Our approach is to drive innovation in the sector, but also to take a measured approach to scaling by gradually expanding in key markets. With President Biden’s new infrastructure package and numerous states like Colorado and Massachusetts exploring state-mandated transitions to electric, we’ll be prepared to more rapidly scale into new cities and states using our unique and cost-effective turnkey solutions, lean operating philosophy and extensive knowledge of government funding sources.

Baker’s entire article can be found here: https://driving.ca/auto-news/industry/ev-charging-industry-is-doing-everything-except-making-money

Back
26
Oct
/
22
26
October
/
22
Electric Vehicles
Electric Car Charging

How EVCS is Addressing the Surging Demand for EVs

The EV world has much to celebrate this year. It seems we’ve reached a turning point. While the overall number of new vehicles sold in America between Q2 2021 and Q2 2022 slumped by 20%, EV sales during that same period jumped over 66%, according to figures released by Cox Automotive. This comes on the heels of a larger global trend, with worldwide EV shipments up 79% year over year.

READ MORE
26
Oct
/
22
26
October
/
22
Press
News
Electric Car Charging

ABC7 Interview with EVCS: Making the switch to an EV? This company uses subscription pricing to ease cost at charging stations

LOS ANGELES (KABC) -- With lots of electric cars already on the road, and potentially millions more to come, one of the related issues is charging infrastructure. Can it work?

READ MORE
10
Oct
/
22
10
October
/
22
Electric Car Charging

The Race to Democratize Charging Infrastructure

According to McKinsey & Company, “As the number of EVs on the road increases, annual demand for electricity to charge them would surge from 11 billion kWh now to 230 billion kWh in 2030… Modeling indicates that nearly 30 million chargers would be needed to deliver so much electricity in that year. While most of these chargers would be installed at residences, 1.2 million would [need to] be public chargers.” More importantly, these public chargers must be targeted to drivers of all ages, genders, races, cultures, income levels and geographic segments. As such, EVCS has identified three primary areas necessary to increasing the democratization of charging infrastructure:

READ MORE
20
Sep
/
22
22
September
/
22
Electric Vehicles
Electric Car Charging

Navigating California’s New EV Mandate

California’s going all in on electric. On August 25th, Governor Gavin Newsom made a very important announcement concerning the future of transportation in the Golden State: “We can solve this climate crisis if we focus on the big, bold steps necessary to cut pollution. California now has a groundbreaking, world-leading plan to achieve 100 percent zero-emission vehicle sales by 2035.” Big and bold, indeed. And while highly encouraging, it brings up a number of questions moving forward.

READ MORE
16
Aug
/
22
9
September
/
22
Electric Car Charging

How EVCS is Repairing Reliability Concerns

One of the biggest concerns among EV drivers today is the reliability of public chargers. One recent survey from the Department of Bioengineering at UC Berkeley claims as many as 23% of public chargers in the Bay Area alone are, as Wired sums up, “nonfunctioning at any given time, stymied by broken screens, shoddy credit card or payment systems, network connection failures, or damaged plugs.” And that’s in a locale prioritizing the conversion to electric. Testimony from motorists seems to corroborate these findings. A CEC survey of 1,290 EV drivers found that fully 60% had experienced damaged or inoperable chargers, while almost half needed assistance from customer service. We find this wholly unacceptable and have taken measures to ensure that chargers in the EVCS network rise to the standard of operability our customers expect. Here are a few ways we’re doing that:

READ MORE