Media Spotlight: Charging pile business under the epidemic

June 29, 2020
     The epidemic may accelerate the tide of global charging pile construction
     As early as 2012, Dongfeng Motor Group and Wuhan Donghu Development Zone, Economic and Technological Development Zone, Huazhong University of Science and Technology, and Wuhan Public Transport Group established a "Wuhan Electric Vehicle Demonstration Operating Company" to explore the use of new energy vehicles and recharge in Wuhan. Piles, since then kicked off the prelude of Wuhan's "species" charging piles; follow-up State Grid has built a number of charging stations in Wuhan.

    In 2015, Dongfeng Electric Vehicle Co., Ltd. took the lead in setting up the Wuhan Regional Charging Pile Enterprise Association in the country to realize the interconnection of information sharing and data communication among multiple pile network enterprises. A number of enterprises and governments such as Special Call, Wanbang, State Grid Hubei Company, and local governments participated, which effectively promoted the orderly development of pile network enterprises.

      However, a "COVID-19" (new coronavirus) that has changed the world economic order has spread around the world, changing our original economic development.

     The Chinese government will stimulate the “new infrastructure” of domestic demand to promote economic development and revive the economy. Wuhan, China's "new crown", is in action, the whole country is in action, Dongfeng is in action, and Junfeng is in action. The main way for "new infrastructure" to boost domestic demand is to build smart cities and accelerate the construction of basic supporting facilities for the operation of urban new energy vehicles-charging piles.



For many years, the electric vehicle industry has been stuck with the question of "have a car first or pile first". Unless there is an extensive network of public charging stations, most people will feel unreliable when driving electric vehicles. However, only when a large number of people use electric vehicles, it is wise to invest in and build a huge network of public charging stations.

The epidemic may accelerate the tide of global charging pile construction

  Coronavirus epidemic may finally break this deadlock. Experts in the electric vehicle industry expect that the overall economy will be under pressure due to the impact of the epidemic, and sales of electric vehicles will decline less than traditional vehicles, and once the market recovers, electric vehicles will rebound faster. Electric vehicles and the infrastructure required for charging are also included in the numerous stimulus plans announced by the European and Asian governments. Looking at the world, in the past few weeks, Germany’s 2.5 billion euro stimulus proposal includes charging piles. The European Union announced that its goal is to install 1 million public charging piles by 2025, and this number is currently less than 200,000.
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Matt Allen, CEO of Pivot Power, a British battery and charging research company, said it was absolutely necessary to incorporate vehicle charging infrastructure into the recovery stimulus. He said that fast charging piles require a lot of electricity at the installation site, the installation process is complicated and expensive. Government investment can help companies eliminate this obstacle and create much-needed jobs, while further promoting economic growth with the development of the electric vehicle industry.

    The key to the development of electric vehicles is to make car owners no longer worry about the cruising range, that is, to make car owners no longer worry about the exhaustion of the battery and cause the vehicle to break down while driving. Javier Guerra, managing partner of private equity firm Satif Group, said that until recently, many companies were reluctant to solve the problem of charging piles. Gera was an early investor in California-based charging equipment company ChargePoint.

Car manufacturers have no incentive to make charging piles that other brands can profit from. For example, Tesla’s chargers can only charge Tesla vehicles and are mainly used for charging at home, while utility companies and oil companies And institutional investors believe that the automotive charging industry has just started, the prospects are unknown, and there are greater risks. Dongfeng Junfeng has also arranged a lot of charging pile business arrangements, including charging and replacing power stations and vehicles in the power exchange mode. Junfeng Co., Ltd. has cooperated with a number of enterprises in the construction of charging piles.

  Gera said that when he started to study the electric vehicle charging business in 2016, few people paid attention to this aspect, and the industry had almost no money to make. However, since then, the battery cost of electric vehicles has dropped by 43%, which makes ordinary car buyers affordable. Then Europe and China introduced stricter emission regulations, and large investors became convinced that a breakthrough was expected in the field of electric vehicles.

   Petroleum companies and utility companies are in an advantageous position to dominate the electric vehicle charging market. At strategic locations in the market, oil companies have built countless gas stations for internal combustion engine vehicles, while utility companies control electricity production and transmission networks.

   Experts in the electric vehicle industry say that it is unclear who will be the final winner. The reason the oil industry giants invest in electric vehicle charging is that they can either do it or must do so in accordance with government requirements, and they have the ability to hedge future risks.

  According to the estimated penetration rate of electric vehicles in the next 20 years, it is expected that by 2040, 12 million public electric vehicle charging points will be needed globally, and this number is currently less than 1 million. This will require a global investment of approximately US$111 billion in the field of electric vehicle charging.

  Some oil giants and utility companies have poured into this field, first of all, Royal Dutch Shell Oil Company, which acquired charging network company NewMotion in 2017. Shell Petroleum now owns or operates 142,000 charging piles in Europe and entered the US market last year through the acquisition of infrastructure and software provider Greenlots. At the same time, Shell Petroleum's rival BP acquired Chargemaster and its 7,000 charging stations for $170 million in 2018.

  Utilities regard the electrification of the transportation industry as a potential life-saving straw. As the energy efficiency of the industrial sector and household appliances improves, global electricity consumption is expected to slow, so electric vehicles can help increase residential electricity demand.

Luis Buil, global head of smart travel at Iberdrola SA in Spain, said that as a user of electric vehicles, car owners no longer need to go to gas stations, and let electric vehicles go to other places after they are fully charged at home-this Is a completely different concept. He said that their company is connected to the power grid, and can guarantee that the car's charging power is 100% renewable energy.

  Iberdrola announced in March that the company will accelerate its development and invest 150 million euros in its fast charging network. EDF acquired a majority stake in Pod Point in February, which has more than 69,000 charging points in the United Kingdom and Norway. The group has previously owned more than 100,000 charging points in Europe through its subsidiary Izivia.
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In the eyes of car manufacturers, oil companies and utility companies, the most perfect charging pile does not need to be connected to the grid at all. Companies such as Shell and Tesla are building micro-power stations that use solar panels to generate electricity. Such power stations can generate and store enough electrical energy to provide a stable source of charging. If put into commercial use, this will make electric vehicles and charging infrastructure green.