Analysis: Electric Vehicle Charging Station Market Potential

The global electric vehicle charging station market size is projected to grow from 2,354 thousand units in 2022 to 14,623 thousand units by 2027, at a CAGR of 44.1%.

The demand for electric car charging stations will increase as the global sales of electric vehicles and the demand for zero-emission transportation both riseup. In addition to the development of ultra-fast charging technology, advancements in technologies such as portable charging stations, bi-directional charging, smart charging with load management, usage-based analytics, and automated payment will generate new opportunities in this industry.

The approaching standardisation of charging ports and government mandates by the world's leading economies have accelerated the installation of charging stations for electric vehicles. With this being said, let’s analyse the market potential that Electric Vehicle Charging stations hold.

Global Market Segmentation For Electric Vehicle Charging Stations

1. Evaluation by Charger : DC charger held a substantial part of the electric vehicle charging station market in 2021. The AC charger, or moderate/slow charger, market has modest growth and market share. Due to the length of time necessary to charge EVs, the segment grew slowly during the projection period.

2. Regional Perspectives on the Global Electric Vehicle Charging Station Market : Asia-Pacific Countries / The APAC is expected to lead the Electric Vehicle Charging Station Market over the forecast period. China has invested over $2.4 billion in developing the country's charging infrastructure. In the future years, Japan and Korea intend to increase the number of electric vehicle charging stations. In addition, the Indian government has announced plans to construct 69,000 electric vehicle (EV) charging stations around the country as part of the first phase of EV infrastructure development, with a demand for 4 lakh charging stations anticipated by 2028. Market expansion in the region is projected to be fueled by consumer adoption of electric vehicles (EVs) and autonomous vehicle-sharing mobility.

3. Market Dynamics of Global Electric Vehicle Charging Stations

A) Key Influencers - The increasing use and popularity of electric vehicles has prompted the creation of a charging infrastructure.

Leading electric vehicle (EV) markets such as China, the United States, and Germany are investing extensively in EV charging infrastructure and R&D for faster and more efficient charging procedures.

Tesla, Volkswagen, Ford, Nissan, BMW, and General Motors all devote substantial R&D resources to electric vehicle (EV) research.

Despite COVID, global EV sales increased by 43 percent to around 4 million units in 2021, while the whole car market declined by 7 percent. This indicates the growing demand for electric vehicles and charging facilities.

B) Major Obstacle - The expansion of the EV sector and variations in charger types have prompted the standardisation of EV charging stations.

Some electric vehicle charging stations may only be compatible with a certain voltage. Numerous nations must standardise their charging infrastructure in order to foster a conducive environment and boost EV sales.

Competitive landscape of the global market for electric vehicle charging stations: The Electric Vehicle Charging Station Market is extremely competitive, with multiple large companies operating in domestic and foreign markets.

The top firms in the sector are embracing strategic partnership initiatives to increase their market share and profits. BP Chargemaster, ChargePoint Inc, Eaton, and Siemens AG, among other market leaders, are some of the leading market participants.

Key market trends for global electric vehicle charging stations: Electric vehicles are becoming a vital element of the automobile industry. This can aid in achieving energy efficiency and lowering emissions of toxic pollutants and glasshouse gases.

Environmental concerns and government actions are the primary drivers of this expansion. By the end of 2025, the annual sales volume of electric passenger cars is expected to surpass 7 million units. By 2025, it is anticipated that 17 percent of all vehicles sold will be electric.

The Expansion: The EV sector has experienced rapid expansion in recent years. In 2021, EV sales in numerous European nations increased by double digits. Regulatory restrictions imposed by various organisations and governments to limit emission levels and promote zero-emissions and eco-friendly vehicles have led to an increase in sales.

Governments from around the world have implemented a variety of programmes and initiatives to encourage consumers to prefer EVs over conventional automobiles.

APAC, Europe, and the U.K. are among the regions that offer various incentives to consumers wishing to acquire an EV; consequently, the Electric Vehicle Charging Station Market will experience increased demand in the coming years.

Indian Market | Breaking down the Market in greater depth

1. Type of charging: Based on the type of charging, the EV charging infrastructure market in India is classified into battery swapping and direct charging, which is further subdivided into AC/slow charging and DC/fast charging. AC is always the type of power that comes from the grid (Alternating Current). However, vehicle batteries are always charged by DC (Direct Current)
2. Location-based market segmentation for EV charging infrastructure in India includes cities and highways. However, the majority of charging stations are now being installed in urban areas, and plans are underway to put additional charging stations on key expressways and roads.
3. Market Size: The market for charging infrastructure in India is fragmented and unstructured as a result of the division between public and private actors and PCS and commercial charging. The greatest indicator of market size is therefore the number of charge points installed by the major CPOs (public and private) in India to date, as well as the number of PCS established under various schemes - FAME I/FAME II.
   

Key Market Drivers:

1. Government Initiative: The market for EV Charging Infrastructure is anticipated to grow substantially in India as in recent years, there have been sustained and extended governmental interventions at the state and federal levels to facilitate the development of charging infrastructure.

2. Business Initiatives: Numerous automotive manufacturers and other private entities, including charging infrastructure developers, have expressed an interest in the development of charging infrastructure.

• Tie Ups With Fleet Operators (for employee transportation by multinational corporations): Large-scale fleet operators like as Ola, Uber, Lithium Urban, Zoom Cars, and door-to-door delivery/courier operators are anticipated to become significant market drivers in terms of CPOs' commercial potential. They have the appropriate commercial motivations to construct charging and digital infrastructures to serve their own EV fleet, given that they operate a large number of vehicles across India. Combined with the strong financial backing of investors, significant fleet operators in India have become early users of charging infrastructure.
• Tie Ups With Gas Stations: Charging companies/OEMs are partnering with gas stations to expand the availability of charging, primarily through the battery changing option. OLA Electric Mobility and Sun Mobility have already established partnerships with Indian Oil Corporation (IOC) for battery swapping stations, while VoltUp has established partnerships with Hindustan Petroleum Corporation Ltd (HPCL) for 50 battery switching stations. Similarly, Bharat Petroleum Corporation Limited and others have also partnered up for different lucrative purposes.
• Tie Ups With Shop Owners: e-2W Companies (such as Ather) are opting for decentralised charging systems in which they have partnered with shop owners to use a portion of their space for chargers or with kirana stores for battery swapping (like Bounce).
  

End-User Challenges

• Range Anxiety: For an EV user, range anxiety is the concern regarding the amount of kilometres an EV can go, i.e. how long will the battery power endure. Before purchasing an internal combustion engine (ICE) car in India, the fuel economy, as measured in kilometres per litre, is a primary consideration. With the existing battery technology installed in electric cars, it is impractical for many EV drivers to go great distances on a single charge.

• Time Anxiety: Customers want to charge as soon as they can refill a gas tank, which is not possible with present charging technologies, particularly with slow charging technologies.

• Charge Anxiety: Charge anxiety concerns the likelihood that the EV will locate a charging station. After this comes the issue of trust. In the case of a gas station, for example, people in India typically double-check the metre before filling the tank; similarly, they have trust concerns with electric charging stations, such as whether or not the car is being charged and whether or not the charging station is functioning properly.

• Private Fleet Operators: The cab aggregators/fleet operators operating in many states find it challenging when different charges for EV charging are levied in different jurisdictions and many states declare EV a separate tariff category.

DISCOMS:

Distribution network and frequent component overloading. Increased peak demand in service areas will necessitate a greater investment in network upgrades and power procurement, which will not be economical for DISCOMs in the long run.

Unpredictable electricity demand, due to the fact that consumers charge their automobiles at diverse locations and times. This will have an effect on the grid's electricity quality.

Further mass adoption of EVs will result in a skewed nature of power demand, which will lead to concerns such as unanticipated peaks in power consumption, transformer overload, voltage drop, and voltage imbalance, as well as the injection of harmonics.

Conclusion: The market is thriving in India because to the government's backing. With a significant emphasis on electric vehicle (EV) transition and, presumably, EV charging infrastructure, the major players have been urged to drive market growth on the basis of an effective regulatory system and industry initiatives. Private companies, including CPOs, equipment makers, cab aggregators, and others, are now able to operate efficiently thanks to EV policy incentives of various states and national measures, such as the reduction of GST rates and introduction of FAME programmes.