Value creation in electric vehicle charging networks

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School of Business | Master's thesis
Degree programme
Information and Service Management (ISM)
Electric vehicles (EV) are gaining a prominent share of the trillion-dollar automotive market. The growth is fueled by falling battery prices, tightening emission standards, government subsidies and increasing competition. The rise of EV’s creates a need for, and also depends on, charging infrastructure on a large scale. Electric vehicle charging networks are services that are used to manage and enable access to charging points. This study aims to understand how these networks can succeed in the tightening competition by examining what factors contribute to the value of an EV charging network for its participants. To reach this goal an explanatory single case study was conducted. The case examined a public EV charging network in Finland. First, earlier research in platform economics and EV charging were used to understand the context and to synthesize a theoretical framework. Next, empirical data was collected primarily with semi-structured interviews. Finally, pattern matching was used to analyze the data. Based on the results, the EV charging industry is still its infancy. EV charging networks mediate transactions between EV drivers and charging point owners (CPO), enabling exchange of information, control of charging points, and payments. Various signals suggest an expansion towards the energy system, as EV charging networks are likely to start aggregating and mediating vehicle-to-grid (V2G) services between EV drivers and energy market agents. The results suggest two focus areas as key factors creating value for participants. Firstly, the main contributor to the success of an EV charging network is the amount of charging points connected to it. This is mainly due to EV drivers’ strong positive cross-side network effects and to CPOs’ strong positive same-side network effects. Secondly, an EV charging network’s boundary resources should be designed to maximize efficiency for both sides. For EV drivers, charging is a mundane task that needs to be as effortless as possible. For CPO’s, offering charging is not a main business, but a relatively small value-added service. This study serves as a starting point for a new research stream, converging EV charging with platform economics research. In addition, the results help researchers in understanding the state of the industry and network operators in making strategic decisions.
Thesis advisor
Tuunainen, Virpi
Mallat, Niina
electric vehicle charging, platform economics, multi-sided platform, network effect, boundary resources, charging point owner, electric vehicle, electric vehicle charging network, electric vehicle driver, platform, platform architecture, vehicle-to-grid