The charging station industry is undergoing a significant transformation as competition intensifies, driven by the rapid adoption of new energy vehicles (NEVs) in China, which has surpassed a penetration rate of 50%. This fierce competition spans from key business districts in major cities to the remote areas of northwest China, involving both state-owned enterprises and private investments vying over technology, market share, and business models.
Recently, fund managers from various public investment firms, including Guotai Asset Management, Jinying Fund, Debang Fund, Nord Fund, and Donghai Fund, shared insights with reporters from the Securities Times. They discussed the investment logic behind the fast growth of the charging station industry. Many fund managers believe that high-voltage fast-charging technology is poised to become the mainstream in the charging station market. With rapid iterations in ultra-fast charging technology and significant capital influx into the sector, the industry is witnessing accelerated consolidation, putting pressure on small and medium-sized companies to either get acquired or exit the market. Key future development directions for charging station enterprises include technological upgrades, expanding into smaller urban markets, and pursuing overseas exports.
Ultra-Fast Charging Poised to Dominate the Market
Recently, the charging station industry has attracted considerable attention in the capital market. The promotion of BYD’s “10C technology” and the large-scale construction of “megawatt charging stations” have led to significant stock price increases for several charging station-related companies, with the Wan De charging station index rising by over 29% this year.
Companies like Huawei, Li Auto, Xpeng, and Xiaomi have announced plans for extensive construction of ultra-fast charging stations. NIO is collaborating with CATL on a battery-swapping model, and various companies are competing to capture more users in the charging station market through technological advancements, leading to a new “energy replenishment revolution.”
For example, Shenzhen is striving to become a “super charging city.” Data shows that Shenzhen has established 1,002 ultra-fast charging stations and over 410,000 charging piles, becoming the first city globally to have more ultra-fast charging stations and connectors than gas stations and pumps. “Car owners can complete charging in the time it takes to enjoy a cup of coffee.” At the integrated demonstration station “Light Storage Ultra Fast Charging – Vehicle Network Interaction” in Shenzhen’s Bijia Mountain Park, three fully liquid-cooled ultra-fast charging mainframes, six liquid-cooled ultra-fast charging guns, and 22 fast charging guns are deployed, along with two energy storage units and photovoltaic canopies, as well as a coffee station. This charging station is the first “Light Storage Charging” demonstration station built through a collaboration between China National Petroleum and Huawei Digital Energy.
“High-voltage fast charging technology is expected to become the mainstream in the charging station market in the future,” said Wang Yang, fund manager of Guotai Intelligent Automotive Fund. He explained that ultra-fast charging primarily involves two technical routes: high current and high voltage. High voltage technology has clear advantages, including reduced energy consumption, increased range, decreased weight, and space savings, making it likely to become a dominant trend in the future.
According to researchers at Debang Fund, leading domestic NEV manufacturers are primarily building their own ultra-fast charging stations. The essence of ultra-fast charging is to enhance energy replenishment efficiency and improve consumer experience. Currently, the market features a coexistence of charging and battery-swapping technologies, but in terms of the total volume of electric vehicles, charging has become the mainstream replenishment method. As technology advances and infrastructure improves, charging is expected to show significant advantages in terms of popularity and user acceptance compared to battery swapping.
Li Heng, fund manager at Jinying Fund, noted that Tesla was the first to build ultra-fast charging stations nationwide, and in recent years, companies such as BYD, Xpeng, Li Auto, and Huawei have started promoting ultra-fast charging capabilities of 5C and above. Most fast charging piles currently on the market operate at a power range of 120-240 kW, while ultra-fast charging stations exceed 500 kW, enabling a full charge in just 20 minutes, which demands higher standards for charging power modules. Meanwhile, NIO and CATL are promoting the battery-swapping model, which allows for battery replacement in a matter of minutes, though its current implementation remains limited.
Wang Yicheng from Donghai Fund believes that both ultra-high voltage fast charging and battery swapping have their respective advantages and disadvantages, suggesting a prolonged competition where overall capability will ultimately matter, such as the integration level between vehicles and charging stations, the pace of grid transformation, and battery standardization. He argues that the rapid increase in NEV penetration will likely drive an upgrade in charging station power, leading to further differentiation in charging scenarios; private charging stations will need to be cost-effective, while public stations will need to address immediate demand. As usage rates increase, the profitability of charging stations is approaching a turning point, leading to the accelerated exit of low-quality production capacities.
A Triangular Landscape of Operations
Currently, numerous companies are involved in the construction and operation of charging stations, creating a triangular competitive landscape comprised of state-owned enterprises, automotive ecosystems, and third-party operators. China National Petroleum and the State Grid are leveraging their energy networks to gain an edge, while companies like Huawei and Xpeng are binding users through closed ecosystem approaches. Third-party operators, such as Telecharge, utilize economies of scale to create competitive advantages.
With low entry barriers, many small startups are also participating in the market, resulting in intense competition among hundreds of players. According to the China Charging Alliance, it is projected that by 2024, there will be 3.58 million public charging piles and 9.24 million private charging piles in China. However, the number of new public charging piles is expected to reach only 850,000 in 2024, reflecting a significant slowdown in growth compared to 2023, which has led to a decline in product prices and increased profitability pressure on manufacturers.
Li Heng explains that operating charging stations is a capital-intensive business. In the early stages of electric vehicle development, utilization rates were low, and profitability was minimal. However, as the number of electric vehicles has increased in recent years, leading operators have begun to see profits. Companies that developed early have a positional advantage, occupying prime locations with higher foot traffic, and the current landscape of charging station operators has stabilized. According to the China Charging Alliance, by early 2025, the top four public charging station operators are expected to hold a combined market share of 58%, indicating a relatively fragmented competitive landscape.
Currently, the entry threshold for the charging station market is low, leading to vigorous competition. From equipment manufacturing to charging station operations, every aspect attracts numerous participants. Researchers at Debang Fund believe that in this market environment, companies with core competencies in technological innovation, service quality, and operational efficiency will gain significant advantages and returns in the ongoing development of the charging station market.
Wang Hengnan from Nord Fund notes that certain resource-integrating giants are expanding their “refuel + charge” energy stations based on their gas station networks, such as the State Grid, which has advantages in grid scheduling and public fast charging. Additionally, leading operators continue to lead the public charging market by leveraging their operational scale and data platform optimization. Furthermore, some automotive companies are enhancing user experiences by building their own ultra-fast charging networks, effectively binding users through combinations of battery swapping and ultra-fast charging.
Wang Yang believes that companies with strong research and development capabilities, high cost-performance ratios, and comprehensive supporting services are likely to benefit significantly from the large-scale development of charging stations. On one hand, companies with strong R&D capabilities are expected to lead industry trends and gain first-mover advantages. On the other hand, enterprises with scale effects and cost advantages in lower-tier markets will remain dominant. Moreover, given the infrastructural nature and high-frequency usage characteristics of charging stations, the lifecycle service quality will increasingly impact user experience and purchasing decisions, providing some companies with competitive advantages through robust support services.
“In the future, three types of companies may emerge as leaders: those focused on technology, those emphasizing scale, and those investing in ecosystem development,” Wang Yicheng stated. The technology-driven companies will have barriers through high-voltage fast charging and vehicle-network interaction technologies; scale-focused companies will leverage high market shares and a large user base to dilute costs and create profitable spaces; and ecosystem companies will integrate offerings from vehicles to charging stations and even cloud services, capturing user loyalty through enhanced services for above-average returns.
Opportunities in Two Key Directions
During interviews, several fund managers indicated that technological innovation and overseas exports could be two crucial directions for the future development of charging station companies.
Li Heng highlighted two primary growth points for the industry: first, the upgrade of fast charging to improve the charging experience for electric vehicles, with automakers launching 5-10C fast charging models, subsequently elevating charging pile power. This increases both manufacturing complexity and product prices. Second, expanding exports to emerging markets, where the development of electric vehicles is lagging in regions like Southeast Asia, the Middle East, and South America, presents new opportunities for rapid growth in charging station demand.
Wang Hengnan also emphasized growth opportunities arising from technological upgrades. The growing demand for faster charging speeds is likely to make ultra-fast charging (such as 800V high-voltage platforms and liquid cooling technologies) the mainstream direction, especially in high-traffic scenarios like highways and city centers. Integrated light storage solutions can alleviate grid pressure and reduce electricity costs, making them suitable for industrial parks and commercial real estate.
Additionally, the penetration of charging networks in lower-tier markets presents growth potential. Third- and fourth-tier cities, as well as rural areas, currently have low coverage of charging networks. With policy subsidies and the promotion of new energy vehicles in urban and rural areas, these regions may become focal points for incremental growth.
Finally, expanding into overseas markets is likely to yield growth opportunities. The construction of charging stations in Europe and the U.S. has lagged, while Chinese companies possess cost and technological advantages in equipment manufacturing and operational experience.
Wang Yang believes that attention should be paid to the implementation of policies, such as the “Notice on Pilot Projects for County-level Charging and Battery Swapping Facilities” and the “Implementation Opinions on Strengthening Interaction Between New Energy Vehicles and the Grid.” These policies are expected to further expand charging station penetration. Additionally, monitoring downstream demand is crucial; the current vehicle-to-charging pile ratio is around 2.5:1, which remains significantly distant from the ideal 1:1 ratio. As the number of new energy vehicles continues to grow, demand is expected to remain strong. Also, the current gap in overseas vehicle-to-charging pile ratios is much larger than that in the domestic market, with relatively high prices and profit margins. Finally, advancements in technology, such as high-power fast charging and integrated light storage solutions, are expected to further stimulate charging station demand.
“The growth of the charging station market has shifted from simply expanding territory to refined cultivation, evolving from being mere power distributors to becoming energy routers. Breakthroughs in ultra-fast charging technology, market penetration in various scenarios, and the restructuring of energy networks may create further growth opportunities,” Wang Yicheng concluded.
As ultra-fast charging coverage expands in major cities, the lower-tier markets in small and medium-sized cities are becoming key competitive arenas. Wang Hengnan notes that there is a significant increase in overall demand; charging stations are rapidly becoming widespread in first- and second-tier cities, with density increasing and extending into lower-tier cities. At the same time, the structural characteristics of demand are becoming evident, with a higher proportion of private vehicles driving demand for community slow charging and destination charging, while ride-hailing and logistics vehicles are increasing the density of urban fast charging points. However, there is also considerable pressure for technological upgrades, as electric vehicle battery capacities commonly exceed 80kWh, pushing charging station power from 60kW to over 180kW, which may lead to the elimination of outdated equipment. Industry consolidation is accelerating, and small operators may face acquisition or exit scenarios, ultimately leading to a monopolistic competitive landscape characterized by “national platforms + regional leaders.”
