How to break the new energy situation?

"Actually, this (new energy charging pile) has not yet formed an industry. In my opinion, all those currently doing this cannot be simply called enterprises, because enterprises must be profitable." Although the acceleration of the market has brought the construction of new energy charging piles into an "ideas" and "funds" intensive period, Jia Xuefeng, CEO of Judian Network Company (hereinafter referred to as "Judian"), has a different view. "Investors like to hear stories, but to put it bluntly, the construction and operation of charging piles are ultimately about services, so the main thing now is to provide a good user experience."

At a time when new energy concepts are surging, Judian is just one of many charging equipment and operation service providers. However, while most people in the industry are focusing on long-term profits, Jia Xuefeng is unwilling to get too involved in this issue.

"It's far from the time to talk about profitability." Sun Hao, chairman of Shenzhen Hualud Electronic Technology Development Co., Ltd. (hereinafter referred to as "Hualud"), told a reporter from China Business Daily: "Although the industry now talks more about 'the wool comes from the pig and the dog pays the bill,' but in fact, this statement is still more at the conceptual level."

Are there too many startups?

Jia Xuefeng believes: There are not many. The concept of entrepreneurship has been very popular in the past two years. New energy vehicles are a very popular industry due to the support of national policies and some topical events. Naturally, some companies that want to make something in this industry will emerge. Many companies make charging equipment, but no company that produces equipment will just stop at making equipment. Everyone wants to build a charging network and deploy it into a network. But it’s easier said than done. It needs to be deployed point by point, and each point has actual operating benefits before you can call it a network. Otherwise it has little practical significance. Investors are smart, and they will not easily pay for a network story. Most investors are financial investors, and they value the economic value of the charging network more. What we have to do is to solve the basic bottleneck problem in the development of electric vehicles, which has both economic and social value. We are thinking every day about how to solve the bottleneck problem of infrastructure in a market-oriented way.

"This was originally a matter for the State Grid and a few state-owned enterprises," in Jia Xuefeng's view, "but the progress in this field over the years has not been ideal. Infrastructure is different from other fields, with large investment, long return time, and a lot of policy support. No market-oriented private enterprise can stand up and say that I can do it. Good. But this industry, like China’s reform and transformation, still needs some idealism, so what we are doing now is to build charging points one by one, making sure that each point can be powered and connected, and can provide car owners with a good service experience, which is a bit like Yu Gong Yishan.” .

Too early to make profits

In Sun Hao's view, the parking charging model is more "reliable" than simply operating charging piles, and the business model is also clearer. "We are an equipment supplier, so we invest at cost price, but seek cooperation at market price. In this process, if the government can give us some subsidies, then our entire investment cost will be much lower than others." Sun Hao told reporters that in the later operation stage, even if there are no cars to charge in the short term, there will still be parking fees as support. “In a market with many new energy vehicles, parking may become an ‘added value’. On the contrary, if there are few new energy vehicles, then charging is an ‘added value’.”

With the above background, Sun Hao believes that he may be able to run faster than similar companies. “Even if it’s just a race for land,” we can grasp resources in advance and hold consumers and the market in our hands.

Although they have great confidence in marketing, they agree with Jia Xuefeng and Sun Hao that "the current time point for profitability is far from mature."

First, new energy vehicles have not yet been widely popularized across the country. Second, even under the background of a clear model, it will take time to implement the project. "There are too many departments involved, such as the National Development and Reform Commission, Electric Power Bureau, Road Administration, etc. Each place must communicate one by one. There is no ready-made model and we can only do it step by step." Jia Xuefeng told reporters.

However, even if the model is reasonable and charging piles are implemented, where will the profits come from? From the current point of view, the direct source is the charging service fee, but even at the price of one yuan per kilowatt hour, the return is still very low.

"There are currently several main types of charging pile operators. One is energy storage companies. The charging pile business is only a small branch of the company's business. They may choose to participate in local bidding and do some public charging pile project business; the second is listed companies. The efficiency of obtaining funds through conceptual operations is much higher than that of industry; and the other is engaged in the private consumer market." Jia Xuefeng told reporters. When it comes to profitability, it seems that the third type of companies should consider more.

"Before we do this, we will definitely have our own calculations. But we don't want to say too much now." Sun Hao said.

Similarly, this is also an issue that Jia Xuefeng does not want reporters to delve into. "When you ask me, you definitely want to hear a packaged story, just like in the capital market, investors like to hear stories." Jia Xuefeng said with a smile that he is now more willing to provide a good user experience first. Only by gathering car owners one by one under the platform created by themselves to form an ecosystem, can the next step and even the next step of "profit" be talked about more. "Don't be anxious, wait patiently for one to two years and give us some more time."