China’s electric vehicle (EV) charging points increased by 56% year-on-year (YoY) in 2021, according to Counterpoint Technology Market Research’s latest China Electric Vehicle and Charging Points Tracker. Since ensuring economic stability is China’s top priority in 2022, accelerating infrastructure investment is expected to boost the growth of charging points. This year, the number of charging points in China is expected to increase by 58% from last year.

Starting from the second half of 2020, the sales volume of new energy vehicles (NEVs) in China has increased rapidly thanks to government incentives to raise NEV sales to 20% of all car sales by 2025. In fact, the 20% target was achieved earlier than planned. In 2021, China’s NEV sales rose 68% YoY, with the vehicle-to-charging point ratio reaching around 3, which means there was one charging point for every three NEVs.

“Refueling or recharging is a crucial subject for the NEV industry’s development. Internal combustion engine (ICE) vehicles have a well-established refueling network and take just a few minutes to refuel. Besides, one can carry a small barrel of gasoline along when going on a long drive. But the EV takes longer to charge – one to two hours even when using a supercharger. Given China’s current policy, the charging point market’s size has a high potential to reach nearly 1:1 vehicle-to-charging point ratio,” said Senior Analyst Ivan Lam.

Currently, third-party charging point operators are the market mainstream, making up 75% of public charging points. State-owned companies account for about 20% of public charging points and vehicle companies take the rest.

“At the moment, China’s charging point market is still very fragmented. Many players have jumped into this industry with the expectation of future growth. The market growth will be expedited with the state-owned enterprises’ penetration,” said Research Analyst Alicia Gong.

In 2021, Starcharge, TELD and State Grid were the top three operators in China, respectively. The top three players together grabbed a 62% share.

“Heavy investment is involved in the charging point business. It requires land (rented or purchased), station construction, charging solution integration, maintenance, and electricity connection. Although there are some incentives available to support this industry, the upfront investment is unavoidable and the payback period runs into years. The backup funding for the leading players has to be solid and from a long-term perspective. We observed that some players which were market leaders a few years back are no longer among the toppers,” said Lam.

China wants the NEV industry to achieve the “Two Carbon” goal, with subsidies for almost every related sector. According to Counterpoint Research’s China NEV Tracker, China’s EV charging point market is expected to increase at a CAGR of 42% from 2022 to 2026 due to a massive increase in domestic NEV sales.

By: DocMemory
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