Bain expects the U.S. electric vehicle charging industry’s profit pool, Europe and China reach 13.5 billion euros by 2030
BOSTON, July 20, 2022 /PRNewswire/ — New search for Bain & Company shows that electric vehicles (EVs) are poised to reshape the automotive and mobility industries faster than expected. Bain expects the U.S. electric vehicle charging industry’s profit pool, Europe and China increase to €13.5 billion by 2030, including up to €6 billion from the United States, up to €5 billion from the European Union (EU) and up to to 2.5 billion euros from China.
Countries around the world have already introduced ambitious green energy targets and supported the transition to electric vehicles. Now the Ukraine the war accelerated these efforts and prompted many governments to further reduce their dependence on Russian oil and gas. The charging infrastructure and services critical to the adoption of battery-powered electric vehicles (BEVs) is a huge and strategic new business opportunity.
“The next decade will be unprecedented for the electric vehicle charging ecosystem worldwide,” said Lucas Martin, partner at Bain & Company. “Future winners are moving fast and partnering to secure the best digital locations and platforms to deliver a seamless charging experience. These leaders navigate market uncertainties by designing scenario-based strategies that allow them to pivot quickly when consumer behaviors or regulations change.”
Where to compete
In the short term, the investments will be used to build the necessary infrastructure. In transit pricing, profitability will depend on the ability to achieve high utilization rates. Winning in this sector will require massive investment in a network of convenient, reliable and fast charging stations (over 150 kilowatts) that provide an excellent customer experience.
Going forward, the largest pool of benefits for home and work charging is likely to be related to next-generation smart energy services, including vehicle-to-grid and vehicle-to-home charging. These services will account for about a third of the total profit pool by 2030, becoming increasingly important as the volume of solar and wind energy increases. These services allow power companies to harness the storage capacity of car batteries to better balance supply and demand.
Electric vehicle charging markets in Europethe United States and China will differ depending on the share of electric car sales, local driving and charging habits, predominant housing type and market regulations. By 2030, for example, BEVs are expected to account for 55% of total car sales in Europecompared to 40% in China and 32% in the United States.
The predominant housing type in a specific market is another important factor influencing charging solutions. For example, the market for charging products for single-family homes will be larger in the United States, where 82% of the population lives in single-family homes, compared to 60% in the EU and 37% in the relevant urban regions of China.
Regulation will also play an important role in the development of the market for smart energy services. The complex patchwork of state-by-state rules in the United States will significantly affect vehicle-to-network service strategies and could slow widespread adoption. The EU aims to create a policy framework to improve energy storage and develop services, while China market will remain highly regulated and concentrated. These conditions are likely to accelerate the development of smart energy services.
“As companies and investors consider where to play and how to win in the electric vehicle charging ecosystem, it will be critical to understand how the demand for different charging occasions and the regulatory landscapes differ by region today and in the future. the future,” said Eric Zayer, partner at Bain & Company. “While consumers in suburban areas of the United States and Europe will be able and will want to charge at home, consumers who live in dense urban areas, such as in Chinawill be forced to charge more in other places, such as work, in destinations such as restaurants or in transit.”
- Transit tax: High-speed transit charging stations require heavy capital outlay – $30,000 for $150,000 per unit. Reliability, convenience, and a differentiated customer experience, like Wi-Fi service and quick-service restaurants, will be critical to success.
- Home charging: Home charging winners will prioritize easy installation, affordable pricing, and bundles with an EV purchase. Homeowners will also seek benefits for their overall home energy management system, including the ability to save electricity and protect against power outages.
- Loading at destination: What matters most in destination charging is selecting high-traffic locations, such as supermarkets or restaurants, and the right type of charger to match the amount of time consumers typically spend there. As with public transport pricing, destination charging stations must be extremely reliable and offer competitive prices.
- Workload : Offices and other workplaces require easy-to-use, inexpensive chargers. Employers have the option of offering this access as a benefit to employees. In some industries, there is a need to recharge fleets of light commercial vehicles and buses. These large-scale depots often need to be equipped for overnight charging and able to work with power grid operators and utilities.
- Smart energy services: Next-generation smart energy service providers will need to offer utilities access to enough parked cars to create a powerful reserve of energy that can balance grid demand. They must also provide smart home or facility devices and an extensive and secure computing platform for smart charging. This includes powerful cloud-based software that can help predict how many cars will connect to the network and what time they will access the service. Leaders will work with grid operators to help them use electric car charging to stabilize the grid system.
Editor’s note: For more information or interview requests, please contact Katie Ware at [email protected] or tel. +1 646-562-8107.
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SOURCE Bath & Company