If there's anybody you might have thought would fight tooth and nail against the rise of mass-market electric cars (EVs), most of us would've put "Big Oil" at the top of the list. After all, the business model of the world's largest oil producers is built around one thing: oil. So the dropping prices and growing popularity of EVs should pose an existential threat to the typical company that's built to drill, pump, refine, and sell oil and oil products. Seeing a future where their profit and position is at stake, some of the biggest oil producers in the world are getting into the clean energy game.
According to the U.S. Energy Information Administration, 67% of American oil consumption is on transportation. Just under half of all oil use in the United States is for gasoline to move vehicles around. EVs obviously use no gasoline or diesel fuel, and require far less oil-based lubrication than a internal combustion engines. The bulk of oil company revenue is under threat, and the consumer demand for EVs isn't going to reverse that trend.
Big Oil is getting into the clean transportation game.
So with current huge profits and healthy coffers on their side, some of Big Oil's biggest players are getting into the clean transportation game. In particular, Shell and BP have been making investments for a while, but with the EV market finally exploding they're pouring in money to ensure they're well-positioned to take advantage. If they can't sell you gasoline, then they'll gladly sell you electrons instead.
BP's EV ambitions started in 2018 with the acquisition of Chargemaster, one of the largest charging networks in the UK at the time. They've since rebranded the charging network to BP Pulse and are working to expand it across Europe and the US. Just this month BP dialed up DC fast-charger manufacturer Tritium and place the largest order in company history — Tritium had just a few months prior opened a new factory in Tennessee that will be instrumental to fulfilling these orders. BP, a company whose name was once British Petroleum, is shooting to be a "net zero company" by 2050, which is quite the shift.
Shell has been on a tear, starting with the 2019 acquisition of Greenlots, a US-based EV charging company. They rebranded Greenlots as Shell Recharge last year, and in the last two years have purchased charging companies in Germany, Spain, and the USA, with a stated goal of having 500,000 Shell chargers installed around the world by 2025.
One of the biggest EV charging networks in the USA was even created because of oil shenanigans: Electrify America is a Volkswagen subsidiary that was created as part of their $2 billion settlement with US regulators in 2016 over their violations of the Clean Air Act for cheating in diesel emissions testing. Gas stations, often small companies bearing the branding of a larger corporation, are also feeling the heat — their lobby group unsuccessfully petitioned for dedicated funding to install EV chargers at gas stations (at $150,000 or more apiece, a high-speed DC charger is no small investment) and even larger fuelers like TravelCenters of America are partnering with EV charging companies to ensure their investments in real estate and convenience retail aren't flushed down the drain when oil-centered transportation declines.
In China, both state-owned giants Sinopec and PetroChina are making big investments in local charging infrastructure to support the investments in electric vehicles made by state-owned car makers like BYD and SAIC. And while Saudi Aramco, the crown jewel of the Saudi royal family's oil portfolio, isn't making investments in EV, the Sauds absolutely are — with a new Ceer vehicle brand to build on the EV platform of manufacturer Foxconn (yes, the same Foxconn that makes iPhones), a potential takeover of luxury EV startup Lucid, and recruitment of companies to build local factories for batteries, motors, and more. Total, the French oil giant, is making big investments in Europe, including a plan to install 20,000 chargers around Amesterdam.
The sole major outlier is Exxon Mobile, which so far has not made any public moves to diversify their business into the electric vehicle market.
Oil companies long ignored their impact on climate change; investing in EV chargers doesn't change their history of environmental damage.
All of this isn't to whitewash the legacy of oil companies. Their wanton drilling has wrecked local environments around the world, they wrecked public transportation in many US cities by buying up fixed rail streetcars and converting them to less efficient bus fleets (that just so happened to run on gas or diesel!), and their own scientists have known for decades that their product was killing the planet and not only refused to really do anything about it, but actively fought against efforts to minimize their damage.
Oil companies aren't investing in EVs just to polish their image, at least that's not the primary motivation. They see the shift of vehicles to electric power as an existential threat to their business, and not one that they can stop. This isn't something that they can buy up and kill like American streetcars — government incentives around the globe are accelerating EV sales, and every major vehicle manufacturer has committed to going fully electric on a somewhat aggressive timeline. This is a "do or die" moment for many of them, as oil use will fall off a cliff in the coming decades and a nationwide EV charger network is not something they can set up overnight. This is an acknowledgement of the long-term realities that face their businesses, and the only way they can maintain their profits and status is to make those investments today.
At this point I wouldn't be surprised to see the larger independent American EV charging companies like ChargePoint and EVgo get snapped up by an oil company in the next few years.
Weirdly, while the oil companies are making big investments in EV infrastructure, the most resistance is coming from politicians. US Senator Joe Manchin, a Democrat from West Virginia, recently pushed for the US Treasury Department to clamp down on incentives for EVs with batteries sourced from overseas. And in a very weird turn, Republicans in the Wyoming state legislature put forward a measure to ban EV sales in Wyoming by 2035. To put it frankly, this is a patently absurd idea put forth by backwards-thinking shitheads trying to save an industry that's acknowledge its own coming demise. Heck, Wyoming has even opted out of federal funding to build high-speed EV chargers across the state. Wyoming accounts for less than 1% of US oil production.
Reaching critical mass for EV chargers is solving the chicken-and-the-egg problem for EV adoption.
Widespread access to EV chargers has been one of the biggest challenges to EV adoption, especially in a largely rural country like the United States. It's kind of a chicken-and-the-egg problem: for a consumer to buy an electric car, they need somewhere to charge it, but for a company to install an expensive electric car charger they need a critical mass of EV drivers to make up their investment. This is the same problem that Tesla saw and tackled with their Tesla Supercharger network, which more than anything is the secret sauce that has powered Tesla's success in EVs.
We have reached an inflection point. Between EV charging infrastructure investments and the expanding availability of more affordable EVs from major manufacturers like Ford, Kia, GM, and Tesla, the US is primed for an explosion in EV sales. Even as US auto sales slump, electric car sales are growing rapidly — up 65% in 2022 versus the year prior. This is just the beginning, and Big Oil is trying to refashion itself into Big Electron before they're left in the very quiet dust.
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