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Hi, I'm Andy.
I know next-to-nothing about money markets, but I know a lot about EVs and the car sales industry.
My small business has put a lot of EVs on the road over the past year, and I am on a quest to put most, if not all, of my earnings into EV Charging Stations!
People are buying and leasing cars they can't put gas in, but they still gotta go places, so I want to buy in to the Charge Stations!
I want to buy in to the most convenient charge network: one that delivers a fast charge in convenient places where I'd park anyway.
Tl~dr: $EVGO went on sale today as they acquired PlugShare.com. The best charging network bought the best site for finding a charger. Buy & Hold $EVGO - Actual EV drivers on the East Coast prefer this charge network. So do GM, Tesla, Nissan, BMW, Ford, and the Biden administration. EVgo has the balance of cost-to-install and utility-to-drivers figured out, which is absolutely key to scaling in this industry.
Don't buy $CHPT - I think it's a trap because the product is not very useful in real life, despite being “#1 largest EVSE network in the US”. The more I unravel, the more I realize that this network is more about raising money/valuation than it is about charging cars and getting drivers on their way.
BG & Motivation
People will need to charge their cars, and EV adoption is climbing big time, so it seems like investing in charge stations is a great bet, as long as you invest in the right one!
This idea started because I actually wanted to own my own charge station in a strip mall.. or a Wendy's parking lot… or something. My research into that taught me enough about the material costs of electricians and permits… and thus I have pivoted into trying to buy charge station stock, instead of a physical charge station. (If anyone knows how I can own my own commercial EVSE in strip malls in NJ, please message me! I am interested!)
Who am I? [I try to restrict being a shill to this section]
Everyone is presumed a shill posting investment advice here. Here is my stake: I own and operate a 1-man car lease brokerage LLC. I help connect people that want to lease new Hyundai Cars & SUVs (Electric, Gas, and Hybrid) to authorized dealerships that have those cars at fair prices. I post content (including price guidelines) on car buying/leasing forums to better educate prospective customers on market conditions when it comes to leasing their new ride. Beyond that, customers can text me, where I charge a $249 brokerage fee to provide a more personal level of service, and an escalation point outside of the dealership. You may have seen enough “dealership horror stories” to understand why I may have a place in the new car market. Frankly, my level of pricing/process transparency is unique in the US market for new Hyundai vehicles. All that aside, this post isn't about getting you in a new car today.. it's about profiting off of charging your car in the future, whatever you buy/lease and wherever you buy/lease it from.
If you look at how important Gas prices have been to the economy… it's a no-brainer that EV charging is going to be big money.
More chargers will be a necessity, and the lack of enough fast chargers is a potential bottleneck to seeing more new EVs join the road. If there is nowhere to charge the cars, I'm worried that I will lose opportunities to connect prospective customers to new EVs. As an EV driver myself, I find EVgo to be the most convenient app and station network to find a charger, and so I bought a heavy position in CLII before the merger. Today, I bought more as the stock dipped below $11 again!
Why EVgo is the Best Charge Network for Consumers.
EVGO stations are, on average, and by my approximation, 30-50x more expensive to install, but charge a car 7x faster - compared to the average Chargepoint Station. Over 100 miles of range per hour, vs 25 miles of range per hour (again this is on average - most of Chargepoint's stations are Level 2).
Electrify America (Volkswagen) does have a few faster stations that are, on average, 100x more expensive to install than ChargePoint Level 2 stations, or 3x+ more expensive to install than EVGO stations. Those stations can charge compatible cars, even faster, as fast as 160 miles in 22 minutes. but I believe the infrastructure costs will keep those stations at designated sites, major interstates, etc.
EVGO provides that “Sweet spot” where its feasible to deploy to the average American strip mall, 50kW charge stations in more places. Per Forbes: https://www.forbes.com/sites/bradtempleton/2020/07/09/the-future-of-ev-charging-may-be-at-50kw-not-the-gasoline-thinking-of-250kw
As an EV Driver, it is delightful to pull up to a station that is conveniently near the shops/business/attraction you already want to go to, and know your car can add 100 miles of range per hour while you're parked running your errands. In my opinion, in this business, it's not about a race to having the fastest charge station in the middle of nowhere where you have to watch Netflix in your car. This is what EVGO gets right, consumer-facing. Fast enough charging in the right places.
Why EVGO makes sense as an Investment to Me.
In addition to a superior charging network, and partnerships with major automotive players, the executive leadership at EVGO has strong ties to the Biden Administration. Biden recently test drove the all-electric F150 with a big smile on his face, so I'm going with the political climate of EVs and EV charge stations to be healthy. Biden also visited an EVgo station recently.
My philosophy is that even if this dips, people will *need* to charge their cars, and there's no way it's not a solid long-term play. This stock doubled in price when the EVGO/CLII merger was first announced, but now it's basically back down to its original valuation, which is what made me feel that now is the time to strike again.
Why CHPT is Annoying for Consumers.
The problem with Chargepoint is two-fold.
The advantage of Chargepoint is: it's simple & cheap to install. You just need a 240V 40A circuit, such as one for a dryer or air compressor, to add a Chargepoint to your existing building/lot. If you want to charge faster than this, you need 480V three-phase power. The difference in investment-to-install goes from a $10k job to install one charger to a $300k+ job to install one charger.
The result is Chargepoint advertises this massive network of chargers, but in reality they're only useful if they're at.. say.. a hotel.. where your car will be plugged in overnight. You see these things at supermarkets and hospitals and at strip malls all over, but they only recoup 20-30 miles of range while you're in the store running your errands, basically negating any benefit after circling a parking lot and finding one to plug in. You also see a bunch of small Boomer town halls getting excited about “being part of the future” for installing one ChargePoint L2 charger in a municipal lot somewhere.
The best example I can give is, on two different occasions I got stuck on a Chargepoint. My destination was 100 or 200 miles away, but I only had about 30 miles of range left on my car. The nearest Chargepoint was 25 miles away, and the nearest DC Fast Charger was about 50 miles away. I could not make it to the Fast Charger, so I had to divert to a Chargepoint. Since the Chargepoint was a detour, I needed to sit at the Chargepoint to recoup 40 miles of range before I'd be able to make it to the fast charger. So I spent 90 minutes in a hospital parking lot in the middle of nowhere. Then, my car had just enough range to drive to the nearest fast charger. Once I got to the fast charger, another 90 minutes added 300 miles of range to my car. But still, because I was 10 miles short on range getting there, I had no option but to add nearly 3 hours of detour. Over 80% of Chargepoints are useless for getting you any further than the next charging station. Consumers expect the average charge station to perform 10-12x faster than what most of Chargepoint's fleet provides! (And 10-12x faster than Chargepoint is still a lot slower than getting Gas)
Why Reddit Has Made me Think CHPT is Also a Scheme.. Financially
So this part is inspired by Reddit. I noticed during the height of the GME volatility that there really was enough evidence of some of these “popular” blogs pushing an anti-GME shill agenda type of thing. I saw that Cramer interview and I took a step back and realized that it did make sense that the companies buying Google Ads to hype stocks might have a financial stake in those values. And sure enough, when you Google for NYSE:CHPT, those same type of sites come up: StockNews, SeekingA*pha, InvestorPlace, Motley Fool, etc. These guys are pumping CHPT, and so this is where I can see this alleged shill-blog behavior (could be either ignorant or dishonest) in a market and landscape I actually understand the fundamentals of.
I think about being stuck for 90 minutes at a Chargepoint to add 40 miles of range to make it to an Electrify America where 90 minutes added 300 miles of range and took me home, and I call bullshit on these Pro-$CHPT articles. Thank you, Reddit, and thank you to those sites themselves that tipped off the general public at how they work during the period of peak GME-volatility. That historical information gives me confidence in asking this *opinion*, and shower thought, “What if a large Chargepoint shareholder actually tried to use a Chargepoint Station, got stranded or inconvenienced on the side of the road, and realized that this needs to pump/dump to get out, thus paying for some media coverage to hype the stock?”
I just don't want to buy $CHPT because the service isn't useful to me. The question I'd love to ask anyone that owns that stock is, is the service useful to you? Have you used it to charge your electric car?
A point on Electrify America (main competitor of EVgo growth)
What not everyone knows is that Electrify America is a wholly owned subsidiary of Volkswagen, and its existence is punitive, as a result of the Dieselgate settlement.
The Electrify America stations are awesome, but also very costly to deploy. 150kW charging needs really beefy transformers and electrical equipment to charge your car that fast. On interstates, 150kW and 350kW charging will be king. But on the more local level, in malls and supermarket and movie theater parking lots, EVGO can install 50kW stations at a fraction of the cost of what VW Group is installing 150kW EA stations at. Electrify America is also a bit of a showcase of the technology, and enables VW to sell more cars like the Porsche Taycan to compete with Tesla. Their end-game is more about interstates than about around-town EV charging. EA's pricing is also currently regulated as a result of the whole dieselgate fiasco, whereas EVGO's pricing is not regulated, and the charge station owner is free to mark up the electricity.
Final Point: EVSEs are more like ATMs than Gas Stations.
I believe that the EVGO model will ultimately follow the ATM model. An enterprising company will put one in every parking lot that makes sense until there is saturation. At that point, rent and rates can be negotiated between the business/utility/ATM owner. Gas Stations are more standalone, whereas the sell of EVSEs is putting them in places that make strategic sense - where people are already driving and spending 45-120 minutes in one place.
In Summary, buy and hold $CLII. Don't buy $CHPT. And if you haven't yet: Try driving an electric car! They're so much fun to drive as long as you can find a place to charge!
Thank you for reading!