Reduce Costs

For charging station operators, the costs of investment and implementation mainly include site construction fees, site leasing fees, and station management service expenses.

Cost of stations

The cost of station construction mainly includes the purchase cost of charging piles, the cost of power engineering and related equipment, the cost of civil construction, and installation service fees; site leasing fees refer to the expenses for renting a site for operating stations; station management service fees include costs for maintenance personnel, replacement parts, and wages for station managers.

EV charging equipment cost

The EV charging equipment is the largest proportion of investment cost. Therefore, from the perspective of reducing costs and avoiding unnecessary later investments, several aspects need to be considered when purchasing and installing charging pile equipment.

• Firstly, it is important to choose charging station products endorsed by reputable brands. Selecting equipment from established companies can relatively ensure the quality of the devices and after-sales service, facilitating operations and reducing subsequent investments caused by equipment aging, line faults, or component losses. This helps lower the overall cost of owning charging stations.
• Secondly, it is important to choose suitable charging piles and transformers based on the current situation, taking into account local conditions and specific needs. For example, when selecting charging piles, it is necessary to consider factors such as parking spaces available at the site and power supply capacity in order to avoid investing in ‘zombie’ charging stations that are underutilized and result in resource misallocation and waste. As for transformers at the charging station, they typically come in different capacities such as 630 KVA, 800 KVA, 1250 KVA, 1600 KVA, and 2000KVA. The cost varies significantly depending on the capacity required. It is essential to consider the actual load of the electrical system when choosing transformer capacity because an oversized transformer would lead to inefficient operation with low utilization rates resulting in increased reactive power loss and unnecessary upfront costs.

Land lease

For land leasing, as it is one of the prerequisites for whether a charging station can be profitable, optimizing site costs should also be fully considered in the early investment. One needs to focus on the location and length of lease. Controllable sites with good locations and long leases will greatly reduce the cost of later relocation, and longer leases mean longer profit cycles after breaking even within equipment service life. In addition, more economical land choices can be considered to lower rental costs, as well as seeking government or local subsidies to alleviate land transformation costs.

Electric power engineering

Investment in power engineering also requires avoiding unnecessary expenses beforehand, such as the cost incurred by the distance of the connection point. Prior to signing a site inspection agreement, operators should confirm with the power supply bureau whether the area is eligible for electricity connection and calculate the estimated costs based on power conditions. Based on our experience from field visits conducted by research institutes, longer wiring distances may result in a doubling or even exponential increase in power engineering costs.

Improve Efficiency

Operators that prioritize “cost reduction” as their primary goal will inevitably face the dilemma of a “market dividend cycle exhaustion” to varying degrees. Perhaps by aiming for “efficiency improvement,” they can build a moat around the entire life service cycle of charging operation stations.

Site selection

Site selection, as the starting point of charging station operation, should be given sufficient attention. Adequate preparation should be made during site selection in order to achieve maximum results and increase expected returns while shortening the payback period. Prior to site selection, data analysis needs to be conducted. For example, conducting a statistical survey on other charging stations within a five-kilometer radius of the proposed location is necessary. This includes understanding their quantity, which platforms they belong to, power capacity, number of active charging points, availability of nearby restrooms, and creating corresponding data analysis tables. Through data analysis, we can estimate the feasibility of establishing a new station and get an idea about potential profits.

Taking over the traffic

For the operation of charging stations, it is not an overnight vision to improve site visibility, provide good post-service operations, find suitable traffic entry points, and carry traffic with a wider range of scenarios.

Therefore, after the site selection and construction are completed, social media and advertising can be used to increase visibility and establish connections with car owner apps, map navigation apps, etc., in order to promote our own charging station and enhance its reputation among nearby car owners.

Charging station operators need to strive to maintain user stickiness and carry out effective post-operation work. For example, measures such as providing convenient payment experiences, regularly distributing coupons and organizing gift draws, as well as establishing and maintaining a fan community can enhance user stickiness and attract more long-term stable users.

If the operation and maintenance cannot keep up, it will greatly affect the revenue situation of charging piles. Considering profit pressure, some operators may omit repairing faults that result in the inability to use charging piles properly, which will lead to customer churn and a decrease in repeat usage rate over the long term.

Therefore, when operating a site, many details need to be taken into consideration. For example, due to safety concerns and other reasons, some new energy vehicle brands do not recommend owners staying in the car while charging. However, even with a 120kW fast charging station, it still takes at least half an hour to fully charge the battery for use. This means that facilities such as restrooms and tea rooms should be provided in the surrounding area for leisure and entertainment purposes. This is also one of the ways to demonstrate differences in service capabilities.

Marketing Strategy

The connection with car owners is a crucial link, which may not directly impact revenue, but it does play a role in increasing user stickiness and conveying the image of charging stations.

For example, operators can promote the implementation of the “charging+” business model at charging stations, creating a comprehensive charging service system that includes services such as shopping, car maintenance, dining, and value-added services. From providing free hot water, heating meals, borrowing umbrellas, and emergency medicine kits on a small scale to offering comprehensive lifestyle services such as car washing and maintenance, convenient dining options, and shopping for leisure activities on a larger scale; continuously expanding the service dimensions of charging stations to enhance their visibility and passenger flow.