Recently, PwC released its report “Electric Vehicle Charging Market Outlook,” which highlights the increasing demand for charging infrastructure in Europe and China as electric vehicles (EVs) become more popular. The report predicts that by 2035, Europe and China will need over 150 million charging stations and approximately 54,000 battery swap stations. This forecast underscores the immense potential of the future EV market and the critical importance of building the necessary infrastructure.
The report indicates that by 2035, the proportion of light-duty electric vehicles (under six tons) in Europe and China is expected to reach between 36% and 49%, while the proportion of medium and heavy-duty electric vehicles (over six tons) will be between 22% and 26%. In Europe, the penetration rate of new electric light-duty and medium/heavy-duty vehicle sales is expected to reach 96% and 62%, respectively. In China, driven by the “dual carbon” goals, these rates are projected to reach 78% and 41%, respectively.
Harald Wimmer, PwC’s Global Automotive Leader, pointed out that the current European market is primarily driven by mid-priced B-segment and C-segment passenger cars, and more new electric vehicle models will be launched and mass-produced in the future. He suggested that the European EV industry should focus on four key areas: accelerating the development and launch of affordable and diverse EV models, reducing concerns about residual value and the second-hand EV market, expanding the charging network to improve convenience, and enhancing the charging user experience, especially regarding cost.
The report also estimates that by 2035, the charging demand in Europe and China will reach over 400 TWh and 780 TWh, respectively. In Europe, 75% of the charging demand for medium and heavy-duty vehicles will be met by dedicated private charging stations, whereas in China, dedicated private charging and battery swap stations will dominate the market, covering 29% and 56% of the electricity demand, respectively. Although wired charging remains the mainstream technology, battery swapping has already been applied in China’s passenger vehicle sector and shows potential for heavy trucks.
The EV charging value chain includes six major revenue sources: charging hardware, charging software, site and assets, electricity supply, charging-related services, and software value-added services. PwC proposed seven strategies for competing in the EV charging market:
1. Sell as many charging devices as possible through various channels and achieve profitability through smart marketing throughout the asset lifecycle.
2. Increase the penetration of the latest software in installed devices and focus on usage and integrated pricing.
3. Generate revenue by leasing sites to charging network operators, utilizing consumer parking time, and exploring shared ownership models.
4. Install as many charging stations as possible and provide customer support and hardware maintenance services.
5. As the market matures, achieve sustainable revenue sharing from existing participants and end-users through software integration.
6. Offer complete charging solutions to help landowners monetize their properties.
7. Ensure the highest possible number of charging sites to maximize electricity throughput while maintaining the profitability of the charging network and controlling service costs.
Jin Jun, PwC China Automotive Industry Leader, stated that EV charging can play a role in a broader ecosystem, further unlocking the value of charging. EV charging stations will increasingly integrate with distributed energy storage and the grid, optimizing within a broader energy network and exploring the evolving energy flexibility market. PwC will collaborate with clients in the charging and battery swap industry to explore profit growth opportunities in the rapidly expanding and competitive market.
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Post time: May-30-2024
