EV Charging Infrastructure Market

Market Overview

The global EV charging infrastructure market revenue was valued at USD 4.04 billion in 2022. It is estimated to reach USD 62.66 billion by 2031, growing at a CAGR of 35.61% during the forecast period (2023–2031). Governments worldwide are promoting electric vehicles to meet fuel consumption targets and curb greenhouse gas emissions. Initiatives like Japan's electric vehicle strategy and India's FAME II project aim to incentivize domestic production and foster the growth of electric vehicle markets and charging infrastructure globally.

Charging infrastructure, also known as charging points, charging ports, charging ports, and charging devices, are charging systems installed in various locations across countries. An electric vehicle (EV) is connected to a power source by a charging infrastructure, which allows for recharging hybrid electric vehicles and community EVs. These infrastructures include an electrical grid, a facility meter, an electric vehicle recharge, a software platform, an energy controller, and a network operating system. In addition, they provide special connectors that adhere to numerous charging connector standards. A charging infrastructure for electric vehicles reduces maintenance costs and environmental damage, eliminates greenhouse gas (GHG) emissions, and improves public health. It also provides varying levels of charge, which aids in determining the level of detrimental vehicle emissions.

Market Dynamics

Market Drivers

Government Policies and Initiatives

The various nations' governments are taking steps to encourage the use of electric vehicles to achieve fuel consumption targets and reduce greenhouse gas emissions in the future. For example, the Japanese government prepared an electric vehicle strategy in August 2018 to improve coordination and ensure a smooth transition in the automotive industry. Similarly, in 2019, FAME II, short for Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles, was a project started in India. It is expected that incentives will catalyze the promotion of domestic production of electric vehicles in multiple countries. These government measures are anticipated to fuel the market for electric vehicles and charging infrastructure over the forecast period.

Decline in Electric Vehicle Prices

Batteries will cost less on average per kWh by 2023—about USD 100 less. As the prices of electric vehicles (EVs) decrease, there is expected to be an increase in the adoption rate of these vehicles. Electric vehicles are expected to have more adoption than conventional internal combustion engine (ICE) vehicles in the predicted timeframe. This can be attributed to the decreasing costs of batteries, which will enable manufacturers to improve their productivity by reducing manufacturing expenses.

Additionally, the prices of EVs are declining as the cost per kW and production costs have decreased steadily over the years. Batteries are declining by around 40%, lessening the overall cost of EVs globally. There is a high pricing gap between ICE and EVs. Hence, the decline in battery prices is expected to contribute to the general decrease in electric vehicle (EV) costs, thereby fostering more adoption of EVs. This trend is anticipated to drive an accelerated demand for EV charging infrastructure throughout the projected timeframe.

Market Restraint

Lack of Standardization in Charging Infrastructure

Standardization refers to the policies and transparency in EV production and the overall EV ecosystem. Initiatives being undertaken by the government and automobile manufacturers in this regard have been increasing in recent years. However, the construction of EV charging infrastructure is not yet on par with EV penetration globally. There are various technical problems in the EV charging market concerning electricity usage, the number of charging infrastructure per vehicle, the time required to charge one vehicle, and its electricity usage.

Additionally, the lack of standardization can be resolved if the government promotes the construction of simplified versions of charging infrastructure across countries. According to the market scale, the standardization of charging infrastructure is a crucial factor in advancing the electric vehicle ecosystem. Over the past few years, this has been a key restraint in the EV charging infrastructure market.

Market Opportunities

Wireless Charging Systems for Electric Taxis

Wireless charging technology has been booming globally, with consumers demanding wireless or on-the-go charging for electric vehicles. Taxis play a significant role in the public transit system, necessitating an expeditious and effective pricing infrastructure. Taxis consume more fuel, which has been a challenge for the government in various countries regarding the environmental pollution caused by taxis. The integration of electric taxis with wireless charging technology offers potential benefits in terms of time efficiency, reduced charging infrastructure expenses, and environmental pollution mitigation.

As of 2019, around 69% of the taxis in New York City were classified as hybrid taxis, while the remaining 31% were categorized as internal combustion engine (ICE) taxis. Countries and cities have taken various initiatives to install wireless charging infrastructure recently. For instance, Oslo is expected to become the first metropolitan city to install a wireless induction-based charging city for electric taxis. This project is anticipated to come closer to the aim of setting up a zero-emission cab system by 2023 in the city. Such initiatives to support wireless EV charging will create opportunities for market growth.

Regional Analysis

Based on region, the global EV charging infrastructure market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. 

Asia-Pacific's EV charging infrastructure industry share is estimated to exhibit a CAGR of 37.37% during the forecast period. China, Japan, South Korea, and India are some of the fast-growing markets in the Asia-Pacific region. The regional electric vehicle charging infrastructure market is expected to witness steady expansion during the forecast period because of the surging adoption of electric vehicles at the commercial level over the next few years. In addition, major developments in EV charging have occurred due to the rising pollution rates in the countries. However, the knowledge gap has been a major challenge for consumers and manufacturers to rapidly penetrate the market.

Unlike China, where commercial and passenger electric vehicles account for a significant share of the automobile industry, India's electric commercial and passenger EV market is still nascent, with just 4,000 units sold in 2020, accounting for less than 0.15% of the market. However, the Indian government has planned an initiative to build around 2,640 charging systems in around 62 cities by 2021. Similarly, the Indian government's scheme called Faster Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME II) is driving growth opportunities for EVs and charging infrastructure.

Europe is predicted to exhibit a CAGR of 31.50% over the forecast period. Europe has one of the most established charging infrastructures globally. Wireless connectivity is becoming the norm in EV charging facilities in the region. The region's vendors support the charging infrastructure and system deployment, government organizations, and other private companies. For instance, ABB supports the European company Vattenfall to develop an EV charging network in Sweden. In addition, the region is targeting investment areas. Partnerships and M&As will further support the market in Europe. For instance, in November 2020, Scania, a transport solution provider, teamed with EVBox Group and ENGIE to hasten the introduction of electric bus and truck solutions across Europe. Automobile manufacturers such as BMW Group, Ford Motor Company, Volkswagen Group, Audi, Porsche, and Daimler have joined hands to form a joint venture called Ionity4 to create a powerful charging network across Europe by 2021.

In North America, automobile manufacturers like Tesla, BMW, and Volkswagen, and charging systems providers, have pooled their efforts as public charging continues to grow in areas of strong EV adoption. Vendors provide advantages such as low prices, multiplugs, and others to attract customers as the market becomes competitive. For instance, drivers can charge for free at over half of ChargePoint's stations, North America's largest supplier of plugs. The EV industry is reaching a tipping point, with over a million electric cars on U.S. roads, and prices are expected to reduce due to more innovation and scale. Such factors all together drive the regional market growth.

Latin America has experienced an enormous expansion in several commercial sectors due to the accessibility of inexpensive labor and an increase in foreign acquisitions. Other primary factors that have created major market opportunities for the wireless EV charging industry in Latin America include improvements in the government policy to reduce pollution-related risks and infrastructural progress. Among the Latin American countries, Brazil is the major revenue contributor to the market, followed by Mexico, Argentina, and Chile. The region is expected to develop substantially due to rapid urbanization, construction activities, and deteriorating air quality in many countries. Moreover, the rising indoor pollution and vehicular emissions are also key drivers that have created the EV charging infrastructure market opportunities in Latin America.

In Middle Eastern countries, the growing focus on environmental protection is propelling electric car sales, and boosting the demand for electric car charging systems. Moreover, the increasing disposable incomes in Middle Eastern countries are also prompting electric vehicle producers to introduce high-end EVs, raising the number of charging systems in the area. 

Segmental Analysis

The global EV charging infrastructure market is bifurcated into the application, mode of charging, voltage, and operation sites.

Based on application, the global market is divided into public and private stations. 

The private station segment is the most significant contributor to the market share and is anticipated to exhibit a CAGR of 33.04% over the forecast period. Charging systems installed in a private station (stations are run by private players and charge a fee for the usage of the device) are growing in number. Private charging stations may or may not be operated by the charger manufacturer. The value chain of private charging systems consists of the energy provider, charging infrastructure manufacturers, and other operating services and maintenance players.

Private charging stations are operated and maintained by collaborating with two or more players that provide different services. The cost of charging in these private charging stations depends on the location, levels of charging infrastructure, and electricity cost in the country or state. Although companies manufacturing charging infrastructure for private charging stations focus on developing new electric vehicle charging infrastructure and charging stations, policymakers collaborate with them to develop EV charging infrastructure.

Based on the mode of charging, the global market is bifurcated into wired and wireless charging. 

The wired segment owns the highest EV charging infrastructure market share and is predicted to exhibit a CAGR of 31.24% over the forecast period. A metal link between the electric vehicle supply unit (EVSE) and the battery charging inlet is necessary for wired charging. Wired electric charging infrastructure employs a power cord connected to the car inlet on one end and a wall outlet on the other to connect directly to the supply. Wired electric charging infrastructure is widely used in construction because these are easy to use and perform well. The growing demand for energy-efficient vehicles is one of the main drivers for growth in the wired EV charging systems market.

Based on voltage, the global market is bifurcated into level 1, level 2, and level 3-5. 

The level 2 segment dominates the global market and is projected to grow at a CAGR of 31.95% over the forecast period. Level 2 charging infrastructure is a low-cost, high-speed charging option. In most cases, Level 2 does not draw enough power to trigger demand charges (unless many are linked to a single meter), keeping the cost of owning or using one low. There are several exceptions, and in these situations, a reasonable rate design business model is used to run for long periods. In addition, the voltage range for L2 charging infrastructure is 208–240 V and can deliver 3–19 kW of AC power. This power output translates to a top speed of 18–28 mph. The standard electric car can be fully charged in 8 hours or less. The outcomes can vary depending on the charger and the EV because some L2 charging facilities can deliver more power than some EVs can handle.

Based on operation sites, the global market is divided into supermarkets, public parks, offices, petrol pumps, and others. 

The petrol pumps segment accounts for the largest EV charging infrastructure market share and is anticipated to exhibit a CAGR of 34.53% over the forecast period. The installation of EV charging infrastructure at petrol pumps has created a feasible network convenient for EV drivers. Petrol pump stations are strategically located based on the driver's patterns and preferences. EV charging systems will be easy to install for vendors in stations where most equipment is already provided with proper station infrastructure and energy supply. Setting up EV charging stations at petrol pumps is anticipated to reduce the per-hour revenue of oil marketing companies.

Currently, EV charging infrastructure installed at petrol pumps can charge USD 2–3.5 per vehicle for up to 2 hours in major countries such as the US, China, India, and others. Therefore, many opportunities are expected to be created in petrol and gas stations, which is projected to boost the development of EV charging stations at petrol pumps across countries.

Recent Developments

• July 2023- GLIDA, an infrastructure provider for charging electric vehicles, announced its plans to invest up to Rs 1 billion by March 2024 to increase the number of charging stations. Formerly known as Fortum Charge & Drive India, the company intends to increase its present number of 450 charging points to 1,000.
• July 2023- SK Signet announced to Reuters that it had signed a contract to supply 1,000 electric vehicle adapters to Francis Energy to access federal funding for charging stations nationwide. The two companies are among those chosen by the state of Ohio to receive more than USD 18 million in federal funding to construct 27 fast-charging stations for electric vehicles along certain interstate corridors.