Business Model: China Charging Infrastructure for EV

I. EXECUTIVE SUMMARY

China’s new energy vehicles (NEVs) have experienced explosive growth for eight consecutive years, securing its position as the global leader. The number of EV charging stations is also increasing rapidly, creating the world’s broadest and most distributed charging station network. This report details the various business models of key Chinese firms, offering insights for potential entrants into the European and other foreign markets.

II. OPERATIONAL MODELS

Three dominant business models govern China’s NEV chargers market:

  1. Charging Operator-led model,
  2. Third-party Platform-led model,
  3. Automaker-led/Cooperative model.

The first two models primarily focus on charging station operations, generating revenue from service fees, electricity margins, and other value-added service fees.

III. REPRESENTATIVE BUSINESS MODELS

  1. Capital-Intensive Models – Teld and StarCharge Teld and StarCharge both adopted a capital-intensive model, heavily investing in charging station construction and operations. This has helped cement their position in the traditional charging station operation market.

A. Teld leverages internet-based strategies and relies on its leading Vehicle-To-Grid (V2G) smart charging technology and system to innovate the business model of EV charging. Its ecosystem revolves around six business models:

  • V2G Network: Building China’s largest EV charging network for the safe, economic, and dynamic charging of EVs.
  • Vehicle Sales Platform: Utilizes charging network to facilitate the sale of EVs.
  • Big Data-Driven Maintenance: Accumulates vehicle data for vehicle maintenance, insurance, and other value-added services.
  • Financial Services: Maximizes the use of cash flows created by the charging process.
  • Cooperative Vehicle Rental: Collaborates with vehicle rental and ride-hailing companies.
  • B2C E-Commerce: Extends value chains by leveraging customer stickiness generated by the charging network.

B. StarCharge’s main business revolves around charging device sales, crowd-funding for charging station construction, and operations, as well as StarCharge app and intelligent charging operational platform maintenance.

  • Equipment Sales: Core revenue comes from charging equipment sales.
  • Service Fees: Maximized through crowd-funded charging station construction.
  • Operational Platform: Establishes operation platform, integrating multiple small and medium charging station operators.
  1. Asset-Light Models – Yun FastCharge and LinkCharger Yun FastCharge and LinkCharger advocate for asset-light operations, emphasizing a business model of “No station construction, no device production, focusing on direct third-party charging station platform services”.

A. Yun FastCharge:

  • Holds a Platform Operation Service that provides basic charging platform operations management and support services.
  • Offers Data Empowerment Services for charging device manufacturers and charging pile operators.
  • Explored Energy Management Services.

B. LinkCharger:

  • Provides an Online EV Charging Solution to charging station operators.
  • Focuses on Offline EV Charging Solutions, simplifying daily operations for charging station operators.
  • Offers “non-electric” services to provide catering services for station operators, creating diversified sources of revenue.

IV. CONCLUSION

Future entrants into European and other global markets can adapt the successful strategies and business models demonstrated by these Chinese companies and apply them according to local market demands and conditions. However, as the regulatory environments, competitive landscapes, and customer behaviors could be vastly different, careful market research and adaptation of these models will be crucial.

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