Key success factors unlocking the hidden potential in Germany’s public EV charging market

• Top 10 EV charging companies collectively hold less than 20% of the market share
• Germany increasingly adopting EVs, but still struggling with charge point deployment with one charger per 26 EVs
• Differentiated offerings via partnerships and collaboration emerging as the key growth drivers in a fragmented market with evolving customer needs

In December of 2022, Germany achieved a significant milestone in its e-mobility journey when the number of battery electric vehicles (BEVs) on the country’s roads surpassed 1 million.[1] Not only did this signal Germany’s commitment to sustainable transportation, it was also a major step on the way to meeting the target of having 15 million EVs on the road by 2030.[2] Beyond its borders, Germany’s achievement also accelerated the EU’s goal of reaching a total of 30 million EVs across the EU by the same year.[3]

However, achieving these goals requires the development of an extensive and efficient charging infrastructure and new innovative approaches to meeting customer demand in a fragmented market. In response to these challenges, the German government has created a favorable business environment for EV charging players that is generating opportunities for companies seeking to leverage synergies and capitalize on the projected market growth.

Business model differentiation is key in a highly fragmented public EV charging market with thousands of players battling for market share

Current state of Germany’s public EV charging infrastructure

While Germany has made commendable progress, charging point distribution remains unbalanced. Germany’s map reveals disparities between eastern and western regions and variations based on population density and other demographic factors. Western and highly populated areas dominate charging points, aligning with EV sales distribution. Notably, Bavaria, North Rhine-Westphalia, and Baden-Württemberg, Germany’s most populous states, have the highest number of charging points: 17k, 16k and 15k, respectively. Out of Germany’s 85k charging points, 14k are fast chargers exceeding 22 kW, including 8k ultrafast chargers over 150 kW. Germany leads in Europe in this category, surpassing France, Spain, Italy, and the Netherlands. [5] This focus on ultrafast charging infrastructure highlights Germany’s commitment to providing convenient and powerful charging solutions for EV owners. Despite advancements, Germany struggles with charging point distribution per EV. Its charging infrastructure is one of the least expansive, with an average of 26 EVs per public charging point, double the EU average and below the desired benchmark. [6] This availability gap raises concerns, potentially hindering EV adoption efforts. Limited access to charging infrastructure inconveniences EV owners and fuels range anxiety, discouraging prospective buyers from transitioning to EVs.

In October 2022, the German government unveiled its comprehensive Charging Infrastructure Masterplan II. This extensive plan comprises 68 measures aiming, among other goals, at integrating e-mobility and grid stability, expanding charging infrastructure for heavy commercial vehicles, and streamlining the site acquisition process with minimal bureaucratic obstacles. To support the implementation of these initiatives, the government has allocated a substantial budget of €6.3 billion.

 

German EV charging market’s key players and dynamics

The German EV charging point operator (CPO) market is highly fragmented, with over 100 companies operating at least 100 public EV chargers each. The top 10 companies collectively hold less than 20% market share. This fragmentation, combined with the expected growth in EV adoption, presents challenges and opportunities for industry stakeholders. Currently, Germany has 5,841 registered charge point operators. The top five players in terms of charging points are EnBW with 4.7k chargers, E.ON Drive with 3.6k chargers, EWE Go with 2k chargers, Westenergie Metering with 1.6k chargers, and Volkswagen’s Elli with 1.6k chargers.[7]

There is a diverse range of archetypes operating on the market:

1. Pure Players: Companies like Allego and Fastned focus exclusively on providing EV charging infrastructure and services.
2. Automakers: Tesla, Ionity (BMW, Ford, Hyundai, Mercedes-Benz, and Volkswagen consortium), and others establish charging networks to support EV model sales, enhance car ownership experience, and maintain customer relationship beyond point-of-sales.
3. Fuel Station Operators: Aral Pulse, TotalEnergies, and others expand offerings to include charging stations alongside traditional fuels.
4. Utilities: EnBW, E.ON, and other utility companies leverage their energy distribution expertise for charging networks and integrated EV solutions.
5. Food Retailers: Aldi and others provide EV charging stations at their locations, leveraging existing parking space and offering additional convenience to shoppers.
6. Renewable Energy Developers: Companies such as GP Joule combine renewable energy expertise with EV charging infrastructure.
7. Auto Dealers: Some car dealerships offer charging services alongside vehicle sales.

 

Collaborations and alliances in the German EV market

In a competitive market, players aim to differentiate themselves beyond speed and coverage by expanding service offerings and prioritizing improving the customer experience. To date, collaborations and alliances have been crucial to achieving those goals by creating and leveraging synergies.

Here are some notable examples:

1. Aral Pulse and Apcoa Parking Group: Aral and Apcoa plan to enhance German fast charging locations with amenities like lounges, drinks, and WiFi.
2. Volkswagen and BP: Volkswagen and BP have formed an alliance to install 4,000 fast-charging points across the UK and Germany by 2025. These charging points will be located at BP and Aral service stations, expanding the charging infrastructure network and accessibility for EV users. [8]
3. Traton, Daimler Truck and Volvo: Milence, a joint venture between Volkswagen’s Traton Group, Daimler Truck, and Volvo Group, set the goal to install and operate over 1,700 high-power charging points across Europe. This collaboration aims to create a robust charging network, enabling efficient charging for electric trucks. [9]
4. Volkswagen Group’s Elli: Elli forges partnerships with various players to increase access to charging points of other operators. Ensuring network accessibility and seamless user experiences are vital for attracting and retaining EV owners.[10]

As the EV and EV charging market evolves, competition among key players intensifies, driving innovation and improving charging infrastructure and services for EV users in Germany. Partnerships are crucial for driving growth in the EV charging market. Collaborating allows stakeholders to combine resources and expertise to create a comprehensive charging network that meets the evolving needs of EV users.

Conclusion:

Germany’s public EV charging market is expanding rapidly, driven by a commitment to sustainable transportation. A robust charging infrastructure is crucial for supporting EV adoption. Challenges persist, including unbalanced distribution of charging points and business model differentiation for CPOs. The market is highly fragmented, intensifying competition. Collaborations and alliances among stakeholders drive innovation and expand the charging network. To succeed, industry players must differentiate offerings, leverage smart charging and forge strategic partnerships.

How Apricum can help:

Apricum has exceptional experience and knowledge covering both up and downstream value chains. In over 15 years, we have delivered over 400 successful projects in 30 countries. Apricum can support you in exploring EV charging opportunities. Our services include growth strategy (strategy review, business model design, new market entry), due diligence (technical and commercial), and transaction advisory (capital raise, buy- and sell-side M&A). Please reach out to Alex Metz, green mobility practice lead, to discuss further.

[1] https://thedriven.io/2023/01/11/germany-reaches-1-million-pure-electric-cars-with-evs-one-third-of-new-cars-in-december/

[2] Incl. Plug-in hybrid vehicles: https://www.cleanenergywire.org/news/german-ev-sales-track-reaching-15-million-target-2030-researchers

[3] https://www.reuters.com/article/us-climate-change-eu-transport-idINKBN28E2KM

[4] Numbers based on Ladesäulenregister

[5] Numbers based on Ladesäulenregister

[6] https://www.iea.org/reports/global-ev-outlook-2023/trends-in-charging-infrastructure

[7] Numbers based on Ladesäulenregister

[8] https://www.innovationnewsnetwork.com/partnership-ev-fast-charging-europe/20850/

[9] https://traton.com/en/newsroom/press-releases/traton-group-daimler-truck-volvo-group-kick-off-european-charging-infrastructure-joint-venture.html

[10] One of many companies that is acting as an e-mobility service provider by including other operators into their charging network