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EV Charging Companies Face Investor Skepticism Amid Falling Profits

Economic Uncertainty and Potential Competition from Tesla Add to Industry Challenges

Tesla charger station on February 15, 2023 in Corte Madera, California. Electric car company Tesla is partnering with the U.S. federal government to expand electric vehicle charging infrastructure in the United States. Tesla announced plans to open an estimated 7,500 of its Tesla Superchargers in the country to all brands of electric vehicles by the end of 2024.
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Overview

  • Electric vehicle (EV) charging companies, including ChargePoint, Blink Charging and EVgo, have seen their share prices drop significantly this year, with investors growing weary of the industry's lack of profitability.
  • Despite the increase in EVs on the road, selling electricity to motorists isn't driving revenue as use rates are relatively low.
  • Companies are concerned about Tesla opening its popular charging network to other drivers in 2024, which could further impact their profitability.
  • Due to economic uncertainty, places that might offer EV charging as an amenity, such as offices, hotels, and shopping centers, are delaying the installation of such equipment.
  • The Biden administration's plans to develop 500,000 charging stations falls short of the 700,000 that would be needed if 40% of American automobiles were EVs.