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EV Charging Faces CRE Reality Check

GlobeSt.com has for an extended time reported on EV chargers as part of CRE development. If tenants and visitors at multifamily buildings, retail, office, industrial, and more were increasingly likely to drive an electric vehicle, planning for charging capabilities made sense. Then there is the question of electric trucks at warehouses and logistics facilities.

However, over the last year, news and trend data show that the full-on push to have EVs everywhere has run into a major speed bump. That doesn’t mean the vehicles will suddenly disappear, but they may not accomplish the once-expected roll-out. In other words, markets have become much more complex.

For example, in 2023, GM cut EV production goals because of falling demand as the company said in an October 24, 2023, earnings call. “We're also taking immediate steps to enhance the profitability of our EV portfolio and adjust to slowing near-term growth,” said CEO Mary Barra. “These steps include moderating the pace of our EV acceleration in 2024 and 2025 to maintain strong pricing.”

In an earnings call a year later, Barra said, “We are on track to produce and wholesale approximately 200,000 EVs this year and reach variable profit positive in Q4. Our EV momentum is growing. We continue to invest in the business and create products our customers love and are willing to pay for as this is fundamental to our success. While at the same time, we're finding efficiencies and opportunities to make the business more profitable.”

CarEdge reported that 2024 Q4 saw a U.S. EV market share of 8.7% — respectable, but flat from the previous quarter. Unit sales in the third quarter were up 15% year-over-year. GM saw a 50% year-over-year increase in EV sales versus 38% for Ford. Tesla’s U.S. market share fell to 44% from 50.9% in the fourth quarter of 2023 and 58% in 2022 Q4. Also, electric truck sales didn’t happen the way automakers expected.

U.S. Energy Information Administration data showed a total of 70,841 charging locations nationwide in November 2024 — 7.4% year-over-year growth. That’s a combination of public and private ports leaving the question of how many are necessary to provide enough infrastructure to support EV growth.

Another consideration is the interest of the auto manufacturers in self-driving taxis. The more EVs are intended for public transportation, the more concentrated the charger use might be, with fewer needed at apartments, office buildings, and retail centers. But right now, regular automated taxis are concentrated in locations with better weather, as the self-driving technology doesn’t work in the widely variable conditions in most of the country.

CRE property owners, developers, and investors should take a step back this year and reconsider the number of charging facilities they might need over the next few years.

Reprinted with permission from the Friday, 17 January 2025 07:10:50 EST online edition of GlobeSt © 2025 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or reprints@alm.com.