Navigant Research Blog

What Is the Next Frontier for EV Charging?

Lisa Jerram — December 23, 2015

We’re in the auto show time of year, and so far this one is the season of the go big or go home plug-in electric vehicle (PEV) announcement. At the Los Angeles Auto show, Audi announced that in 10 years it expects 25% of its car sales to be plug-ins. To reach this target, the company will be offering plug-ins throughout its vehicle portfolio. At the Frankfurt Auto Show in September, the company revealed a concept version of one of these future offerings, a battery-powered quattro SUV. Although not connected to an auto show, Ford’s December announcement that it would add 13 new electric options to its vehicle lineup by 2020 was noteworthy in part because it came from a non-luxury brand OEM.

When these and other new PEVs roll out from 2017 on, the PEV market will shift into a new phase, marked by real diversity of offerings across vehicle platforms. Right now, the PEV market is somewhat hampered by the limited number of segments where plug-ins are available. OEMs have focused mostly on the smaller vehicle body types for PEVs like the Nissan LEAF, the Chevrolet Volt, and the BMW i3. This isn’t a criticism of the OEMs—it made sense to roll out a new technology like EVs on a limited scale to test consumer interest. As a practical matter, the weight and cost of adding lithium ion (Li-ion) battery capacity to a plug-in vehicle in 2010 naturally led OEMs to target small vehicle platforms requiring less power. But with Li-ion battery costs dropping at a faster rate than many projected in the last 5 years and pack prices projected to decline 5%-6% annually through 2020, OEMs are well-positioned to offer plug-in options throughout their vehicle portfolios, including vehicles with larger capacity like SUVs. At a minimum, this greater variety expands the potential buyer base, and it is a critical development in a market like the United States where bigger still reigns supreme.

The Next Big Challenge

These announcements are also pointing toward the next frontier in the EV charging market: fast charging. If the PEV market is going to look more like the mainstream vehicle market, with plug-ins a common option, customers will have to be able to use them like mainstream vehicles. While many of the new PEVs will be plug-in hybrids without range limitations, many will be battery EVs with a 200-mile or longer range. This will make them a no brainer for daily driving habits but will still limit their ability to cover drivers’ long-range driving needs. The solution is likely to be the development of fast charging networks along highways, spurred by automaker investment. This is the approach being taken by Tesla with its Supercharger networks. For the broader rollout of fast charging, the auto industry players will have to grapple with how much to pay for it, how such a network would be run, and how to cooperate with each other in this effort.

One response to “What Is the Next Frontier for EV Charging?”

  1. John V says:

    Lisa: I need to correct one thing here. Ford did not announce 13 new “electric” vehicles. It said it would have 13 new “electrified” offerings.

    That includes not only cars with plugs, but also conventional hybrids, and likely even cars fitted with nothing more than a 48-Volt enhanced start-stop system.

    It’s been widely misreported that Ford’s 13 new vehicles will be electric. If I were a cynical man, I’d suggest that Ford intended that to happen. I’m not, but Ford’s commitment to vehicles with plugs remains no higher than it has been to date–which is to say, not very.

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