Automakers need way more plug-in stations to make their EV plans work. That has sparked a buying frenzy as big charging players gobble up smaller ones.

EV-charging stations for electric cars in Gothenburg, Sweden.

EV charging has a newfound boost from government incentives and industry spending.
Charging companies are turning to M&A to juice funding further.
EV-charging consolidation is the latest to hit the auto industry.

Electric-vehicle-charging outfits have been racing to conquer territory by snapping up smaller players, and industry experts anticipate this year’s buying frenzy to continue.

The charging space has picked up momentum as automakers are pouring billions into EV development. Legislation like the infrastructure and climate bills, along with state programs, are pushing to accelerate EV adoption and building out charging stations is a huge part of that.

Yet charging companies face plenty of challenges. Even with funding, building EV-charging infrastructure remains extremely costly and time-consuming. 

Because of these struggles, not every company will make it — some smaller companies are betting that larger ones will gobble them up and take on their assets through mergers and acquisitions. Global M&A activity in the charging space this year hit at least $900 million across 25 deals as of this week, according to PitchBook. That includes at least $200 million across seven deals in the US. 

“For the smaller companies, it’s hard to scale up on their own. They really need larger partners,” Steve Hilfinger, a partner and senior business counselor with the law firm Foley & Lardner, said. “This is going to take a lot of capital.”

The auto industry’s latest M&A frenzy 

Given the long lead time on vehicle development, automakers have relied on consolidation to integrate expensive technology into their portfolios. The M&A frenzy taking place in the charging and electric-vehicle world is just the latest example.

Car companies and electric-vehicle startups have been striking deals for the past several years as the industry barrels toward an emission-free future. …read more

Source:: Businessinsider

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