Volkswagen sold a minority stake in its electric vehicle charging division, Electrify America, to Siemens in a deal that values the company at $2.45 billion. The two companies are jointly investing $450 million to double the number of Electrify America charging stations in the US and Canada by 2026. (The news was first reported by The Wall Street Journal.)
The news comes amid a spike in EV sales in the US — although they still only represent a fraction of overall car sales. It also comes as the Biden administration, fueled with $5 billion in funding as part of the president’s infrastructure plan, embarks on a plan to build 500,000 EV chargers by 2030.
That plan will rely significantly on investments from private partners, like VW’s Electrify America, which operates more than 730 charging locations and over 2,438 individual charging units as of March 2022. And those partners will, themselves, need partners to help shoulder the huge costs of building out an entire charging network from scratch. DC fast chargers that supply up to 350kW of power can cost up $250,000 to install, depending on the location.
Siemens’ minority stake in Electrify America amounts to “a low triple-digit million USD investment,” the companies stated — though they wouldn’t disclose the exact figure. The German company will also get a seat on Electrify America’s board of directors.
Siemens, which has said it wants to build 1 million EV chargers in the US, is Electrify America’s first external investor. VW created the business in the wake of the Dieselgate scandal, in which the automaker installed software in its vehicles to deceive government pollution tests.
VW says the plan is to “more than double Electrify America’s charging infrastructure to 1,800 locations and 10,000 fast chargers by 2026.” The company is also in the process of building a series of new “human-centered” charging stations in California and New York, complete with solar panel awnings and a lounge-like waiting area.
EV charging in the US is difficult and intensely fragmented, especially for people who don’t own a Tesla. There are approximately 41,000 public charging stations in the United States, with more than 100,000 outlets. But finding one that actually works or isn’t locked inside a gated parking garage, for example, can be a challenge.