Emerging Market of Electric Vehicles

As the automotive industry continues to adopt electric vehicles (EVs), PwC analysts predict the market could expand almost tenfold by 2030. This projection is supported by an increase in consumer interest and the willingness of automakers to go all-in for the expansion of the U.S. electric vehicle market.

Substantial government funding has also played a significant role in the growing EV sector. The 2021 Infrastructure Investment and Jobs Act allocated $7.5 billion to EV charging infrastructure, and the Inflation Reduction Act introduced tax credits for those purchasing new and used commercial and passenger EVs.

Considerable investments are still needed to build a national charging network for the estimated 27 million U.S. electric vehicles expected on the roadways by 2030. While such an undertaking will prove challenging, it is necessary to ensure the future viability of EV transport. U.S. manufacturers throughout the EV supply chain—from battery manufacturers to metal part fabricators—are ramping up production of EV components and charging infrastructure parts to support these electrification trends.

Electric Vehicle Market Trends

PwC’s recent study highlights the main U.S. electric vehicle market trends to expect in the coming years. Since 2021, over 20 electric vehicle charging startups in the U.S. and the EU have been acquired, many by major energy companies. In the past four years, at least five EV businesses have gone public through special purpose acquisition companies (SPACs), and funds raised from initial public offerings (IPOs) have given these businesses the cash to acquire other EV businesses.

Analysts expect the workplace segment to be the fastest-growing charging segment, with anticipated growth from around 0% of the total EV market to approximately six million charge points (or 17%) by 2030. Multi-unit residential apartment buildings are another fast-growing sector, also expected to expand from nearly 0% to 17% of the market by 2030. This rapid growth will task construction and engineering firms with integrating charging points in new and existing garages and parking lots.

Meanwhile, EV sellers (like dealerships and OEMs) will dominate 70% of the market for residential chargers in single-family homes. Integrators and installers are predicted to serve 80% of all other EV charging market segments.

Key Takeaways From the EV Supply Equipment Market

The electric vehicle supply equipment (EVSE) market has the potential to grow at a 15% compound annual growth rate (CAGR), from $7 billion in the early 2020s to $100 billion in 2040. Here are some insights into the future of the following key areas in the EVSE market.

Hardware Manufacturers

Product developers of EVSE face high upfront costs for manufacturing, research, and development. These costs are necessary to remain competitive in the EV market, and hardware providers can expect considerable long-term gains from the rising demand for EVSE services and products.

Software Providers

To generate a revenue stream from EVSE applications, software companies must develop customer-facing and back-end solutions. Profit margins are expected to increase as fleet management solutions are integrated into existing on-the-go systems.

Installation Services

Despite being a lower-margin business, installation services are expected to grow quickly as the need for public charging infrastructure continues to increase. As federal government funding gets disbursed, installation service companies may find relief from the reduction in new installations and start experiencing a significant increase in retrofitting outdated infrastructure.

Charge Point Operators (CPOs)

Today, many charge point operators (CPOs) are burdened by low utilization rates and hefty capital expenditures. While these businesses are in it for the long-term payoff, a successful CPO business model will be challenging to execute. However, companies that manage to ride the wave may reap substantial dividends when charging stations become as common as gas pumps.

As EV adoption rates become mainstream, integrated charge point operators (CPOs) will have the chance to improve their bottom lines by bundling offerings such as:

• EVSE Financing
• Operation
• Utility Charging
• Maintenance

Creating Jobs in the EV Market With the Infrastructure Act

The $1.2 trillion in funding from the Infrastructure Investment and Jobs Act aims to tackle the following challenges facing the expanding U.S. electric vehicle market:

1. Address the repair backlog in transport systems
2. Modernize and secure existing infrastructures
3. Support the transition to a clean economy

Part of the funds from this long-term federal investment includes the expansion (by thousands of miles) of the electrical grid’s high-voltage transmission network across the U.S. This expansion will help facilitate the efficient delivery of renewable energy through transmission corridors marked high priority, supporting the nation’s transition to an integrated grid that can help regions share power and control electricity shortages and pricing volatility.

The Infrastructure Investment and Jobs Act comprises a variety of grants, loan financing programs, and technology development incentive payments that businesses need to understand to take full advantage of the available offerings while anticipating the reporting obligations and conditions that come with them.

Automotive Metal Fabrication by H&S Manufacturing

To keep pace with the rapid acceleration of EV adoption in the U.S., EV charging infrastructure builders need to scale up their operations accordingly. H&S Manufacturing has the expertise and equipment to help EVSE businesses meet the challenging supply needs of EV charging stations. Since 1968, H&S Manufacturing has provided custom metal fabrication services for the automotive, electronics, medical device, aerospace, defense, and other critical industries. Our experienced team can help you select the best material for your application and deliver high-quality custom components for your project.

Contact us today to connect with a team member about the specific demands of your EV project.