More EVs, Less Profit? The Shrinking Charging Battle

In China, the explosive growth of EVs is pressuring the charging infrastructure, leading to a price war that could compromise quality.

Summary: The balance between expansion and profit

On the brink of the electric vehicle revolution, the charging network finds itself at a crossroads that could redefine the business model.

New Players, Profits Under Pressure

The growth of EVs in China is driving charging demand. In 2024 there were 12.87 million NEVs, with penetration already above 40%; in 2025, this level surpassed 50%.

Combined data from CPCA and CAAM indicate that in the first two months of 2026, accumulated sales reached 1.02 million, with 45.2% penetration (an 8.6 percentage point increase compared to the previous year).

From Expansion to Price: The Violence of the Tariff War

The former hegemony of state-owned enterprises opened space for PetroChina, Sinopec, platforms like Xiaoju Charging, and thousands of medium-sized operators. Stations proliferate, fragmenting the customer base in a saturated red ocean.

With increasingly homogeneous services, many compete for customers with aggressive tariffs. The earning model depends almost exclusively on service fees embedded in the energy price.

This pressure caused service tariffs to drop during 2024-2025, from about 0.23 yuan/kWh to 0.17 yuan/kWh. Considering energy losses (0.05 yuan/kWh) and land rental (0.08–0.12 yuan/kWh), this figure is already close to the 0.17 yuan margin, leaving many operating at a loss just to maintain visibility.

Towards a “Service War”

This trend puts pressure on equipment manufacturers and component suppliers, increasing the risk of quality cuts and undermining long-term competitiveness.

From small operators to major players, almost no one emerges as a winner. The pace of deployment is slowing down, increasing the risk of stagnation in the sector.

Experts advocate for a return to rationality: consumers value experience—speed, cleanliness, and reliable equipment—as much as price.

Practical Examples and the Path to Quality

In Zhejiang, January marked the awarding of stars to stations. Six locations received five stars; another four received four. The evaluation system focuses on safety, operational efficiency, convenience, and green performance, connecting training to continuous service improvement.

Conclusion

Only by moving away from short-term price competition and investing in service quality can the sector regain investor confidence and ensure user safety, opening space for a transition from a “red ocean” to a sustainable “blue ocean”.

Comments: do you believe service quality can curb the price drop in EV charging, or will we still see tight margins? Share your view in the comments.