The Disrupters: EVgo Jolting the Charging Network Business

Industry insiders, analysts and consumers agree that the growing proliferation of electric vehicle charging stations will encourage more consumers to buy EVs.

The lack of infrastructure remains an oft-cited factor, albeit not the only one, stymieing more widespread adoption of EVs. Los Angeles-based EVgo has been leading the charge with its efforts to jolt the EV market by building out the largest public, fast-charging network in the US. The company has more than 1,000 chargers located in 66 metropolitan areas across 34 states.

Jonathan Levy, vice-president of the company’s strategic initiatives, says about 90% of new EVs sold in the US are in these metro markets, which is why they selected these locations and that the company owns about half of the public networked chargers in the US.

When asked if EV sales or infrastructure build out would lead to greater uptake of these vehicles, Levy laughed, saying: “We should bury the chicken and the egg and talk about the hotdog and the bun. In the movie Father of the Bride they talk about how the hot dog buns come in packs of six and hot dogs don’t, so you end up having more of one (buns or wieners) than the other. You have to build the infrastructure to give consumers confidence in the market to buy EVs but you can’t get too far ahead of the market.”

The chargers are 50kw or more and are non-proprietary so any EV, including Tesla, can use the stations using CCS or CHAdeMO connectors or an adapter. Levy says EVs such as the Nissan Leaf or BMW i3 can get about 85% of their charge in half an hour on the chargers, adding that Chevrolet Volts and other vehicles with larger batteries take longer.

Even with greater numbers of charging stations, the disparity in charging times vis-à-vis filling up the tank with gasoline remains a challenge for the industry, according to Graham Evans, principal analyst, automotive supply chain and technology, IHS Markit.

“Charging performance won’t be that quick for a time. That will continue to hold people back [from buying EVs] – 80% in 20 minutes is pretty impressive but, for a lot of consumers, it’s too much of a barrier for them.”

More powerful chargers that could recharge batteries quicker raise other issues, added Evans. “The capabilities are there on the infrastructure side, 350 kw charges but the biggest challenge is what are the implications on the vehicle in terms of how the battery receives it and the durability when regularly charging a vehicle like that? There’s a lot of concern about the warranty and OEMs are keeping a cautious eye on this type of charging.”

Still, charging companies are trying to capitalize on their first-mover advantage. “EVgo is well placed and has good collaborations with OEMs,” notes Evans. “They have a lot of infrastructure in the ground and it’s well used and they are providing early adopters with what they need.”

Among its several commercial partners, EVgo also works with WaiveCar and the car sharing company’s co-founder/COO, Zoli Honig, says the partnership is important to his nascent firm. “We work hand-in-hand [with EVgo on expansion plans], with the EVs especially you have to be mindful of the charging infrastructure. That’s one of the reasons we went to LA in the first place, because the charging infrastructure was really built out.” WaiveCar, which is based in neighboring Santa Monica, California, claims to be the first all electric and free car sharing service.

Levy claims his company in August had reached 42 million miles charged, exceeding 2017’s full-year record by two million: “We’ve seen increased sessions, it correlates well to the increased number of vehicles sold to apartment dwellers that rely more on public charging stations [and not home chargers]. More people are getting more power session; some of that can be attributed to bigger batteries like GM’s Volt.”

In fact, the charging space is ripe for consolidation according to Evans. He points to acquisitions in Europe where BP bought Chargemaster in the UK and Shell purchased NewMotion. He added: “The likes of EVgo and ChargePoint will struggle to maintain their positions as a dominant provider for EV charging. The threat from [VW’s] Electrify America to the long-term business model of EVgo is apparent. It’s not terminal, there’s space for EVgo, they proved they can do it and have a robust business that’s turning a profit.”