The global electric vehicle (EV) charging station industry is on the verge of a significant transformation, with forecasts indicating a remarkable growth trajectory. According to market analysis, the demand for EV charging stations is set to surge by 16% per year, reaching $26.6 billion by 2027. This surge in demand is driven by various factors, including falling product costs, making EV charging infrastructure more accessible, and adoption of electric vehicles worldwide.
Industry Growth Despite Challenges
The global electric vehicle (EV) charging station market has witnessed impressive growth in recent years, despite the economic challenges posed by the pandemic. In 2020, the industry faced a setback due to the pandemic, experiencing its worst year-over-year performance since its inception. However, sales still managed to rise by over 9%, with the weak performance primarily attributed to disruptions. In 2021 and 2022, the market rebounded vigorously. Automakers' commitment to enhancing EV capacity led to robust growth in private charger sales, even amidst global chip shortages affecting vehicle production. Despite challenges like supply chain disruptions and rising materials costs, the EV charging station industry leveraged economies of scale and maintained relatively stable cost structures. The market is poised for further rapid growth in 2023, supported by increased EV production, government support, and the flourishing fleet segment, with declining hardware costs as supply chain issues dissipate.
Technological Advancements Driving Growth
Advancements in battery technology have facilitated the rise of electric vehicles (EVs) and the proliferation of EV charging infrastructure. During the 2010s, lithium-ion batteries took the spotlight, displacing nickel-metal hydride counterparts that were common in early hybrid and electric vehicles. This shift made lithium-ion the dominant choice for EV batteries. The growing production of EVs will necessitate a substantial increase in global lithium-ion battery output, with the Asia/Pacific region, Western and Eastern Europe, and North America all showing significant demand growth. However, concerns about material supply constraints are prompting battery manufacturers to explore alternatives, such as lithium iron phosphate (LFP) batteries and sodium-ion batteries. While LFP batteries offer advantages like reduced reliance on cobalt and nickel, sodium-ion batteries hold promise for their cost-effectiveness, potentially reshaping the EV battery landscape in the medium term.
Charging station companies such as electrify america are establishing subscription plans for EV owners, making charging more convenient and cost effective. Companies such as this are also offering charging station location features, and promising increased locations. These features and member benefits are designed to compete with gas station chains offering similar convenient programs.
The global demand for electric vehicles (EVs) is set to skyrocket, with a projected 20% annual growth, reaching 25.3 million units by 2027. Key factors driving this surge include national clean energy goals, incentives, expanding charging infrastructure, improved battery tech, and a wider range of EV models. Battery electric vehicles (BEVs) will lead the charge, while plug-in hybrid vehicles (PHEVs) are expected to decline by 2032. To read more about EV charging station markets worldwide, consider purchasing Freedonia Group’s new report Global Electric Vehicle (EV) Charging Stations.