Photo source @Visual China

Wen | Energy Chain Research Institute, author | Chen Sixian

Although the epidemic has had an impact on many industries, the field of electric vehicles and charging infrastructure is an exception. Even the US market, which is not a prominent global performer, is starting to soar.

Techcrunch, a US technology blog, predicted the US electric vehicle market in 2023, saying that the Inflation Reduction Act (IRA) passed by the US government in August has had a huge impact on the electric vehicle industry, and automakers are working to move supply chains and factories to the United States.

Not only Tesla and GM, but companies like Ford, Nissan, Rivian, and Volkswagen will benefit.

In 2022, electric vehicle sales in the United States were dominated by a handful of models such as Tesla's Model S, Model Y, and Model 3, Chevrolet's Bolt, and Ford's Mustang Mach-E. 2023, with the opening of the new plant, will see more new models come out, and they will be more affordable.

McKinsey predicts that traditional automakers and EV startups will produce as many as 400 new models by 2023.

Moreover, in order to avoid "dropping the chain" in terms of charging pile infrastructure, the United States announced in 2022 that it will plan a $7.5 billion budget to build 500,000 public charging piles, and the non-profit organization ICCT estimates that by 2030, the demand for public charging piles in the United States will exceed 1 million.

The growing electric vehicle market

The global Electric vehicle market, including Hybrid Electric vehicles, Plug-in Hybrid Electric vehicles, and Battery electric vehicles, It continues to heat up in the harsh environment of the COVID-19 pandemic.

According to McKinsey's research report (Fischer et al., 2021), despite the overall slump in global auto sales, 2020 is a big year for electric vehicle sales, and by the third quarter of that year, global sales of electric vehicles actually exceeded pre-COVID-19 levels.

Among them, sales in Europe and China increased by 60% and 80% respectively in the fourth quarter from the previous quarter, pushing the global electric vehicle penetration rate to a record high of 6%. While the U.S. lags behind the other two regions, EV sales grew nearly 200% between the second quarter of 2020 and the second quarter of 2021, helping to achieve a domestic penetration rate of 3.6% during the pandemic (see Figure 1).

Figure 1 - Source: McKinsey Research Report (Fischer et al., 2021)

However, a closer look at the geographic distribution of EV registrations across the United States shows that the growth in EV adoption has not occurred evenly across all regions; It is strongly correlated with population density and prevalence in metropolitan areas and varies from state to state, with some states having higher EV registrations and penetration (Figure 2).

One outlier remains California. According to the U.S. Department of Energy's Alternative Fuels Data Center, light electric vehicle registrations in California surged to 425,300 in 2020, accounting for about 42 percent of the nation's electric vehicle registrations. That's more than seven times the registration rate in Florida, which has the second highest number of registered electric vehicles.

Two camps in the U.S. charging pile market

In addition to China and Europe, the United States is the world's third largest charging pile market. According to IEA statistics, as of 2021, the number of new energy vehicles in the United States is 2 million, the public charging pile is 114,000 (36,000 charging stations), the public pile ratio is 17:1, of which slow charging accounts for about 81%, slightly lower than the European market.

U.S. charging piles are divided by type into AC slow charge (including L1- 2-5 miles on a charge in 1 hour and L2- 10-20 miles on a charge in 1 hour), and DC fast charge (60 miles or more on a charge in 1 hour). Currently, L2 accounts for 80% of AC slow charge, with ChargePoint contributing 51.5% market share. DC fast charger accounted for 19%, led by Tesla, the market share reached 58%.

According to a report by Grand View Research, the U.S. electric vehicle charging infrastructure market is worth $2.85 billion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of 36.9% from 2022 to 2030.

Here are the major electric vehicle charging companies in the United States:

Tesla

Electric car maker Tesla owns and operates its own network of superchargers. The company has 1,604 charging stations and 14,081 superchargers worldwide, located in public Spaces and at Tesla dealerships. No membership is required, but it is limited to Tesla vehicles equipped with proprietary connectors. Tesla can use SAE chargers via adapters.

The cost varies by location and other factors, but is typically $0.28 per kilowatt-hour. If the cost is calculated based on time spent, it is 13 cents per minute below 60 KWH and 26 cents per minute above 60 KWH.

The Tesla charging network typically consists of more than 20,000 superchargers (fast chargers). While other charging networks mix Level 1 (more than 8 hours on a full charge), Level 2 (more than 4 hours on a full charge), and Level 3 fast chargers (about 1 hour on a full charge), Tesla's infrastructure is designed to allow owners to get on the road quickly with a short charge.

All superchargers are displayed on an interactive map in Tesla's on-board navigation system. Users can see stations along the way, as well as their charging speed and availability. The Supercharger network allows Tesla owners to get the best ride experience without relying on third-party charging stations.

Blink

The Blink Network is owned by Car Charging Group, Inc., which operates 3,275 public Level 2 and 3 chargers in the United States. The service model is that you don't need to be a member to use the Blink charger, but if you join a member, you can save some money.

The base cost of Level 2 charging is $0.39 to $0.79 per KWH or $0.04 to $0.06 per minute. Level 3 fast charging costs $0.49 to $0.69 per KWH, or $6.99 to $9.99 per charge.

ChargePoint

Based in California, ChargePoint is the largest charging network in the United States with more than 68,000 charging points, 1,500 of which are Level 3 DC fast charging devices. Only a small percentage of ChargePoint stations are Level 3 DC fast charging.

This means that most charging stations are designed for slow charging using Class I and II chargers in commercial premises during weekdays. It's a perfect strategy to improve customers' comfort with EV travel, but their network has significant shortcomings for interstate and long-distance travel, making it unlikely that EV owners will rely entirely on ChargePoint.

Electrify America

Electrify America is owned by carmaker Volkswagen. Electrify America plans to install 480 fast-charging stations in 17 metropolitan areas in 42 states by the end of the year, with each station no more than 70 miles apart. No membership is required, but discounts are available for joining the company's Pass+ program. Charging costs are calculated by the minute, depending on the location and the maximum power level the vehicle can accept.

For example, in California, the base cost of 350 kW power capacity is $0.99 per minute, 125 kW is $0.69, 75 kW is $0.25, and each charge is $1.00. The Pass+ plan costs $4.00 per month, $0.70 per minute for a 350 kW charge, $0.50 per minute for a 125 kW charge, and $0.18 per minute for a 75 kW charge.

EVgo

Headquartered in Tennessee, EVgo maintains more than 1,200 DC fast chargers in 34 states. Rates for fast charging vary by region. For example, in the Los Angeles area of California, it costs $0.27 per minute for non-members and $0.23 per minute for members. Registration costs $7.99 per month, but includes 34 minutes of fast charging. Either way, Level 2 charges $1.50 per hour. It should also be noted that EVgo has an agreement with Tesla to make EVgo fast charging stations available to Tesla owners.

Volta

Volta, a SAN Francisco-based company that operates more than 700 charging stations in 10 states, stands out because charging Volta devices is free and requires no membership. Volta has paid for the installation of level 2 charging units near retailers such as Whole Foods, Macy's and Saks. While the company pays the electricity bill, it makes money by selling sponsored ads displayed on the monitors installed on the charging units. The main drawback of Volta is the lack of infrastructure for level 3 fast charging.

2022: Big year for electric car sales

The U.S. electric vehicle market is expected to grow from $28.24 billion in 2021 to $137.43 billion in 2028, with a forecast period of 2021-2028, representing a CAGR of 25.4%.

2022 will be the biggest year on record for electric vehicle sales in the United States. In the third quarter of 2022, electric vehicle sales continued to outpace gasoline-powered vehicles, with more than 200,000 electric vehicles sold in three months, setting a new record.

Electric vehicle pioneer Tesla remained the market leader with a 64 percent share, down from 66 percent in the second quarter and 75 percent in the first quarter. A decline in share is inevitable as traditional automakers, hoping to match Tesla's success, race to meet the growing demand for electric vehicles.

Ford, GM and Hyundai are leading the way as they scale up production of popular electric vehicle models, such as the Mustang Mach-E, Chevrolet Bolt EV and Hyundai IONIQ 5.

Despite rising prices (and not just for electric vehicles), U.S. consumers are buying electric vehicles at a record pace. New government incentives, such as the electric vehicle tax credit provided in the Reduction of Inflation Act, are expected to drive further demand growth in the coming years.

The United States now has a total share of more than 6 percent of the electric vehicle market and is on track to reach a goal of 50 percent share by 2030.