As the country comes to the realization that a future of electrified mobility is crucial to mitigating the effects of climate change, government leaders and the electric vehicle (EV) industry have made it their mission to build a network of 500,000 EV chargers across America.
At the same time, the past year has demonstrated how disruptions in globally interconnected supply chains can lead to severe bottlenecks and slow production. The EV charging industry is not immune to these conditions. In order to achieve the ambitious electrification goals set by our elected officials and business leaders, EV charging companies must ramp up their domestic manufacturing capabilities to ensure they can meet the demand, regardless of global factors.
Meeting “Buy America” Requirements
There’s no better time than now to increase American manufacturing. With the Biden Administration’s Infrastructure Investment and Jobs Act (IIJA) earmarking $7.5 billion to build a nationwide charging network, there is more investment in the space than ever before. However, in order to qualify for these federal funds, EV charging manufacturers must meet the “Buy America” requirements – standards that call for equipment and projects to use American-made material and products, as well as be manufactured domestically. While domestic production of EV chargers holds much promise in solving supply chain concerns, this requirement also presents several challenges.
When considering the “Buy America” requirements for EV chargers, two provisions are most relevant. First, all steel in a finished product must be sourced locally. Secondly, under current criteria as clarifying language is pending, at least 55 percent of a finished product must come from the U.S.
Generally, meeting the steel requirement is not a challenge for EV charging manufacturers as chargers do not require large amounts of steel and steel can be locally sourced without undue burden. However, the larger challenge for EV charging manufacturers is sourcing domestically made chips, as most chip manufacturing is done offshore and imported to the U.S. From microprocessors to Wi-Fi and cellular modem chips, these necessary components are hard to source domestically, presenting a significant roadblock for EV charging manufacturers looking to meet the “Buy America” requirements.
In addition to the challenges presented by the “Buy America” requirements, there are also logistical challenges that come with relocating a manufacturing process, that was previously done overseas, entirely to the U.S.
In other countries, robust manufacturing corridors exist – areas of production where the various parts of a product are all sourced near one another – that help reduce the time and cost it takes to assemble critical components. However, in recent decades many of these components have been imported from overseas, and the U.S. has far fewer manufacturing corridors. This means domestic manufacturing facilities will have to re-invent their processes and supplier relationships to better centralize them and avoid the expenses and pollution incurred by shipping parts across the country.
As we transition to this new age, EV charging manufacturers are facing a plethora of challenges as well as unprecedented/exciting growth opportunities. From adhering to the “Buy America” procurement requirements to working out the logistics of a new supply chain, manufacturers have a lot to overcome, all while trying to keep up with the demand of a growing population of EV owners.
Building Out Domestic Manufacturing
Right now, the biggest hurdle facing domestic EV charger manufacturing is time. In order to tap into the federal funds made available by recent legislation, manufacturers must build up domestic capabilities and expertise in new areas, from sheet metal fabrication to PVC manufacturing, quickly.
With these challenges, it may seem daunting to make the transition to domestic manufacturing. However, Blink Charging, a leader in the EV charging industry for close to 14 years, has long been aware of these concerns and is taking steps to overcome them.
Managing the EV Charger Supply Chain
In June of 2022, Blink acquired SemaConnect, a leading provider of EV charging infrastructure solutions in North America with a state-of-the-art manufacturing facility in Maryland. This acquisition brought the complete design and manufacturing processes of Blink’s EV chargers in-house, allowing the company to comply with the “Buy America” provisions in federal law. The acquisition also marks Blink’s emergence as the only EV charging company to offer complete vertical integration – from research & development and manufacturing to EV charger ownership and operations – creating unparalleled opportunities for the company to control its supply chain and accelerate go-to-market speed while reducing operating costs.
In addition, Blink recently announced its commitment to establish a new manufacturing facility in the United States, which will further increase its charger production capacity. While the search for the facility’s location is still ongoing, the plant will offer 200,000 square feet of space with the latest technology to manufacture both DC Fast Charging (DCFC) and Level 2 Chargers.
With one facility already up and running and another on the way, Blink is leading the charge in domestic manufacturing of EV charging infrastructure in the U.S.
Harjinder Bhade is Chief Technology Officer at Blink Charging