20 Sep 23

How carmakers are changing the charging landscape

More and more automakers band with each other and energy providers to develop joint charging networks or branded platforms. As these collaborations and initiatives are no longer restricted to high-power charging, the automakers are tapping into unchartered service models and profit pools, from which fleets as customers can also benefit.

The studies proving how the lack of charging infrastructure is hampering E.V. adoptions keep piling up. Driven by scarcity, new business models, the room for an improved customer experience, and Tesla's undeniable headstart, automakers have decided to step into alliances all over the globe and help shape the charging landscape.

In Europe, these joint efforts are welcomed as the Alternative Fuels Infrastructure Regulations (AFIR) demand a fast charging point every 60 kilometres across member states starting 2026. In the USA, the U.S. Department of Energy's National Renewable Energy Laboratory calculated that the nation needs to jump from 150,000 public charging stations today to about 2.3 million by the decade's end. That's fifteen times more in a window of seven years, which will demand a vast investment and effort from the private sector, stretching far beyond charging start-ups.

The automotive OEMs respond in two ways: by setting up a branded charging network, in the likes of Tesla, or by securing cross-brand cooperations. The reasons for the latter are multi-faceted:

  • As the instalment of fast charging points roughly costs 150 000 euros, the joint effort represents a significant cost advantage.
  • The success of E.V. adoption is directly tied to the rollout of the charging network. The involvement of more players and investment is a prerequisite for an accelerated uptake.
  • As car manufacturers are slowly but gradually making bidirectional charging available, these partnerships contribute to a more resilient grid.
  • Many customers are unhappy with the conveniences offered in situ, which often fail to alleviate the longer waiting times compared to the short filling times of combustibles. Together, automakers can uplift the charging experience and have stronger control over customer satisfaction.
  • A propriety network makes for a more seamless approach, bypassing charging app companies. These initiatives enhance BEV usability.
  • Charging is an ecosystem involving all players, from municipalities to the fleet customer. Therefore, an umbrella approach for fast charging is a consensus - but not the exclusive method - among car makers.

The umbrella projects

As the first answer to the Tesla Supercharger network, which has opened to third parties, the seven-brand strong Ionity platform paved the way for pan-European electric mobility, but not without pitfalls. Though the company remarkably upheld pricing for its favourable subscription for fleets during the war-inflicted energy crisis, the participating brands demonstrated lukewarm reactions to the provided quality. Its service, open to vehicles from all brands, will jump from today's 1,500 to 4,000 fast chargers by 2025, shifting focus from motorways to urban areas.

Similar to Ionity, Hyundai, Kia, Honda, BMW, Stellantis, Mercedes and General Motors announced the formation of a yet-to-be baptised high-speed charging U.S. network of 30,000 pillars by the end of the decade, entirely powered by renewables.

Staying in the U.S., an alliance between Ford, Honda and BMW has inaugurated Chargescape. This vehicle-to-grid company wants to connect energy providers with the car brand's customers while these charge at home, the office or publicly. It's revolutionary because its innovative platform gives utility companies access to the batteries in E.V.s, but fleet managers will also be able to choose the most profitable charging time and capitalise on the vehicle-to-grid connection. As a common platform, it undercuts the need to navigate negotiations with numerous energy providers.

Branded initiatives

Mercedes will start in the fall of 2023 by constructing its first branded supercharging stations across both sides of the ocean, with a targeted global network of 10,000 charging points by 2030. The hubs, built and managed by local partners, concentrate on key cities and major arteries. Open to all vehicles, Mercedes drivers get preferential access.

Hyundai is the only car brand switching to manufacture its own high-speed charging equipment through its technology arm Mobis for its South Korean station network E-Pit - a road less travelled. The delayed rollout suffers from the expensive upfront cost, as Hyundai targets a supreme customer experience.

Transforming that service into a club experience is Porsches and Audi's take. The first opened its first fast-charging lounge (300 kW) accessible to registered I.D.s only. Clients and SME executives benefit from a preferential rate of 33 cents per kWh and a visit upgraded with luxury amenities. Audi's modular lounges are open to all brands but, interestingly, function independently from the grid by the assistance of second-life E.V. batteries. The positive feedback from these pilot projects makes ramp-ups feasible.

The importance of collaborations to facilitate permitting, propriety purchases and cost is demonstrated by Renault, albeit inversely. By the absence of a partner, its Mobilize brand will open 200 fast-chargers, supplying 400 kW, located at selected car dealerships situated within five minutes from motorways.

Subcontractors, in some cases, grow into full-fledged partnerships. Stellantis is deploying public charging at 15,000 locations, such as parking places, together with TheF Charge in Europe. In the U.S., Volvo struck an agreement with Starbucks and ChargePoint to install public chargers every 100 miles at coffee stop locations. When investment to provide convenient amenities is insufficient or as a cost-cutting measure, this partnership can bring added value.

Benefits for fleets

Aware of fleet managers' obligations to meet decarbonization goals, automakers, in most cases - upon verification - guarantee electricity from renewables by binding contracts or by carbon offsets and credits. A further convenience is that fleet customers, by using the brand app, not only enjoy preferential rates, which can be up to three times lower but also benefit from central billing by automatic car VIN identification, abolishing the risk of unwanted charging—furthermore, pre-booking and controlled charge-load management help to reduce downtime to a minimum.

However, as automakers are venturing into the new revenue stream opportunity from charging services, customer satisfaction is only part of the puzzle. While their cross-brand efforts will give them more leverage to meet the proposed challenges, their collaboration with utility companies and energy providers will be the strongest shackle. As network ambition should only expand within utility capacity, these need to keep pace with each other. 

Image Source: Mercedes

Authored by: Piet Andries