The automobile sector is undergoing a radical transition from Internal Combustion Engine (ICE) vehicles to Electric Vehicles (EVs). Year-over-year growth in EV adoption consistently exceeds predictions—a rare occurrence in any industry. By the end of 2024, China alone reached 34 million EVs, with projections indicating a sevenfold increase over the next decade. While China and the European Union lead this transition, other regions are quickly following suit. This article provides comprehensive insights into various aspects of EV technology.
Types of Electric Vehicles
EVs are available in three main categories. Battery Electric Vehicles (BEVs) are fully battery-powered vehicles charged via external AC or DC power sources. BEVs support Level 1, Level 2, and Level 3 charging options. Plug-in Hybrid Electric Vehicles (PHEVs) combine both ICE and EV technologies, allowing owners to select between modes. PHEVs have smaller battery capacity than BEVs and support Level 1 and Level 2 charging. Hybrid Electric Vehicles (HEVs) integrate ICE engines with battery technology. These vehicles primarily run on combustion engines, with power source selection managed automatically by built-in software algorithms. The battery charges through the ICE engine with no external charging capability.
A fourth emerging category is Fuel Cell Electric Vehicles (FCEVs), which utilize a combination of hydrogen fuel cells and battery technology.
Drivers Fueling EV Transition
Global warming, climate change, CO₂ emissions, and sustainability initiatives are key drivers of EV adoption. Following the 2015 Paris Agreement, 196 countries committed to limiting global warming to 1.5 degrees Celsius and achieving net-zero emissions by 2050. Nations support this transition through special incentives, import duty rebates, and promotional campaigns.
Rising fuel prices, particularly during geopolitical conflicts, have also increased interest in EVs. In some countries, charging an EV can be up to 80% cheaper than refueling a conventional vehicle.
Manufacturers are prioritizing EV development, incorporating innovative features such as auto-parking systems and advanced digital dashboards that attract new buyers. The technology has matured to the point where EV owners now experience comparable convenience to traditional vehicles.
Current EV Market Penetration
In 2024, EV sales in China surpassed those of gasoline vehicles for the first time. The country added 12 million new EVs, bringing the total to 32 million. Passenger EV adoption exceeds 50%, while heavy goods vehicles have reached an 18% monthly penetration rate. Public transportation (buses/taxis) has achieved 70-72% electrification.
The EU region has reached over 22% EV penetration, with leading countries including Norway at 95.6%, Iceland at 60.1%, and Finland at 54.4%.
EV adoption is in the earlier stages but is growing rapidly, with notable penetration rates in Hong Kong at 60%, Singapore at 33%, and both South Korea and Thailand at 10%.
Charging Infrastructure Challenges
Inadequate public charging networks remain a significant deterrent for potential EV buyers. Current issues include limited availability of fast/ultra-fast charging stations, extended charging times and long waiting queues, and stations typically supporting only 2-4 vehicles simultaneously.
Modern EVs are increasingly built on 800V DC platforms capable of ultra-fast charging, but infrastructure must evolve accordingly. Future charging stations should adopt a gas station model that can simultaneously accommodate 10-12 vehicles to meet urban demand.
The Charging Point Operator (CPO) Perspective
CPOs aim to maximize electricity sales, with revenue directly linked to kilowatt-hours (kWh) sold. However, many operators struggle with profitability due to suboptimal deployment strategies:
CPOs should build stations that support multiple simultaneous charges and develop high-capacity (~500kW) stations to maximize electricity sales. They must focus on the utilization factor, aiming for 95%+ of available capacity (utilization) to be disbursed to connected vehicles. Additionally, minimizing operational expenses (OPEX), particularly maintenance costs, and extending charger lifespan is crucial for success.
In short, CPOs must consider utilization factors, OPEX, and equipment lifespan to build sustainable business models and reduce return on investment periods.
Conclusion
While EV technology is approaching maturity, we’re still in the early stages of a comprehensive transition. In the near future, we can expect:
- Accelerated transition from ICE to EV vehicles
- New EVs featuring enhanced digitalization and advanced technologies
- Expansion of charging infrastructure to match growing demand
- Development of full-service charging stations similar to gas stations, covering highways, malls, parking areas, and other strategic locations
By Nitin Joshi, Expert, HUAWEI Digital Power MECA region