Will Electric Vehicle Charging Station Business Be Profitable or Not?

The electronic vehicle charging business is a newly formed business opportunity with a growing business model. The customer base for EV charging stations is directly or indirectly dependent upon the increase in the sales of electronic vehicles. According to this report, the highest market share for electronic vehicles in 2020 was won by Tesla Model 3 with 12%, followed by Wuling’s Hong Guang MINI EV with 4%, and Renault Zoe with 3%.

From the above data, you can see that how the market is bending towards green energy-powered vehicles. But should this be the only parameter to judge the profitability of the electric charging station business? Of course not!

From an economic point of view:

The electric charging station business requires a large space for charging the vehicles that need charging. Today, the number of actively running electronic vehicles is low that directly impacts the charging station business, i.e., as the revenue is being created by the charging activities.

Providing high-speed charging businesses require fast chargers, which can cost up to twenty lakhs and includes transformers, cables, safety equipment, etc. One charge won’t create a business model, you would require multiple chargers to match customers’ flow.

If you see the chart here, you would find that there was a sudden downtrend that happened in the global market. That might reflect to you that this business model is not as profitable as you think. But the market has seen a rapid correction in a significant amount of time.

Over the next few years, the demand for electronic vehicles is expected to grow, creating a revolutionary impact on the entire electronic charging station business.

A majority of people think that establishing a successful electric charging business is challenging. They may be right because there cannot be any successful business model until there’s an ample number of electronic cars on the road. Though the electric charging station business model is tricky, some companies are planning to put an insane amount of money into this model which can clearly show the future of the electric charging business is profitable.

As per the report regarding the electrical charging infrastructure satisfaction, 59% of respondents have exclaimed that China’s electric vehicle charging was fairly good. Contradictory to that, just 22% of respondents thought that Japan’s electric vehicle charging infrastructure was fairly good in 2019 and it will eventually grow in subsequent years.