Commentary on EV Industry Profitability Claims

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.

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

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Top 10 Reasons Why Mass EV Adoption is Inevitable

According to evadoption.com, EV sales are expected to grow from 3.4% of all new auto sales in 2021 to 29.5% in 2030. In fact, they cite several models that forecast explosive growth in EV ownership across the US over the next decade. See the full sales forecasts here complete with bar charts and supporting data: https://evadoption.com/ev-sales/ev-sales-forecasts/. While skeptics might pooh-pooh these projections as overly optimistic, we believe they may actually fall short of the eventual reality. Of course, only time will tell, but below are our top 10 reasons why we believe EVs will be as commonplace as microwaves come 2030.

Installation of the Month (July 2021): LADOT Lot 657

One of our main goals has been to install charging infrastructure in underserved communities, especially urban population centers that are key to our mission of wider EV adoption. Los Angeles is rife with such neighborhoods, where low-income families who wish to participate in the greening of society cry out for cost-effective ways to be part of the solution. Lincoln Heights, one of the oldest sections of the city, is a prime example. The densely populated area boasts numerous Latino, Asian and Pacific Islander groups who have expressed interest in electric mobility, but historically lacked access to the requisite charging stations. Moreover, with a median age of just 24, Lincoln Heights is brimming with younger generation Angelenos who have already embraced the idea of sustainability, but simply need the opportunity to take action.

West Coast Electric Highway to Receive Extensive Upgrade from EVCS

ARCADIA, Calif. (August XX, 2021) – EV Charging Solutions (EVCS), one of the largest electric vehicle (EV) fast charging network operators on the West Coast, today announced that they are approved and funded by the Oregon Department of Transportation (ODOT) to upgrade 44 and add three new electric vehicle charging stations on the Oregon portion of the original West Coast Electric Highway (WCEH). Eleven of the 47 stations will be called “superstations” and will include three DC fast chargers and one Level 2 AC charger. In all, more than 100 charging ports will be upgraded or added.

Is Policy Action Alone Enough to Reach Net Zero by 2050?

Recently, BloombergNEF published a telling article titled, “Electric Vehicle Sales Set to Rise Faster Than Ever, but More Policy Action Needed to Get on Track for Net Zero.” The author raises many interesting observations about where we are now in the transition to electric mobility; where we’re projected to be in 10, 20 and even 30 years based on current trajectories; and what we need to do if we’re going to be net zero by 2050.

Auto Trends Magazine: Occhiuzzo Debunks 4 Misconceptions Surrounding EV Fast Charging Stations

Our co-founder and CEO, Gustavo Occhiuzzo, is quickly emerging as a thought leader in the world of electric mobility, becoming someone stakeholders can count on to demystify obscurities and address falsehoods surrounding the installation and application of charging infrastructure. Like any new technology, resistance to adoption is often based on fallacious notions, some of which may be perpetrated by those with a financial interest in competing technologies. Therefore, countering such notions with facts is crucial if both drivers and site hosts are to make an informed decision about EV adoption. Occhiuzzo most recently addressed four of the biggest misconceptions surrounding chargers in the article below for Auto Trends Magazine.