Why charging infrastructure does not fail because of prices, but because of utilization and fixed costs

Introduction: The wrong guiding question

From the provider’s perspective, charging infrastructure is often reduced to a seemingly simple question: „Are we cheap?“ This question is measurable, comparable, and easy to communicate. But it is strategically irrelevant. It overlooks the only lever that truly matters in this market: utilization.

It is not the price that determines profitability, but the volume of recurring charging processes. The central bottleneck is not in the kilowatt-hour, but in usage.

The reason is simple: Charging infrastructure is not a product business. It is an infrastructural service system with extremely high fixed costs. Here, it is not what a kilowatt-hour costs that matters, but how often it is sold and whether the customer returns.

The economics of charging infrastructure

Charging infrastructure does not follow the logic of classic product markets. It is a capacity-bound system whose profitability almost entirely depends on usage.

• The essential costs arise before the first charging process takes place. Locations must be developed, grid connections built, and hardware installed.
• Backend systems, maintenance, and troubleshooting run continuously—regardless of whether charging is taking place or not.

Economically, this means: The vast majority of costs are fixed. The only degree of freedom lies in throughput.

The success is not determined by the number of stations, but by how many charging processes are handled daily. Not expansion scales. Not price scales. Not margin scales. Only volume scales.

Why margin is not a scaling lever

In classic business models, margin is the central lever for profitability. In charging infrastructure, this logic does not work.

Willingness to pay is structurally limited by:

• High price sensitivity
• Low differentiation
• High comparability
• Regulatory and political pressure

At the same time, a higher price does not change the cost structure. It does not reduce fixed costs, increase utilization, improve scalability, or protect against competition.

Margin is a result, not a lever. Those who try to enforce profitability through price only shift demand in the short term. In the long term, they lose volume. And without volume, there is no fixed cost degression.

Price as a false lever

The fact that price is still at the center of many strategies is no coincidence. Price is visible. Everything else is not. Reliability cannot be evaluated in advance. Seamless operation is not comparable. Consistency of expectations only emerges through experience. Location quality only becomes apparent on-site.

What remains is the tariff. And that is precisely why it is overestimated. But price fulfills only one function: It shifts demand in the short term. It does not stabilize it.

A location with frictions can be filled through price for a certain period. But every friction turns margin into friction. Aborts generate support costs. Waiting times destroy trust. Lack of transparency reduces return visits. Inconsistency damages the brand.

Price fills the station in the short term. Friction empties it in the long term. Price is not protection. It is hope. The hope of lasting longer than the competition.

Utilization is not a goal, but a result

A central misconception is the attempt to optimize utilization directly: through price promotions, location expansion, or marketing. But utilization is not a lever. It is a result.

Utilization cannot be directly optimized. Only trust can be optimized. Because long-term utilization arises exclusively through return visits. And return visits arise exclusively through frictionless experiences.

According to my Trust-Friction Framework:

Trust = Reliability × Fair Pricing × Accessibility × Consistency of Expectations

Only from this does the chain emerge:

Trust → Return visits → Usage → Utilization → Volume → Fixed cost degression → Profitability

Those who try to skip this chain optimize symptoms instead of causes.

Throughput beats inventory

Another strategic mistake lies in the focus on assets. Many operators measure success by the number of locations, stations, installed capacity, or coverage.

But what is economically relevant is not the inventory, but the throughput.

The decisive question is not „How many stations do we operate?“ but: „How many charging processes take place daily per location?“

A small location with high return visits is more valuable than a large charging park with low usage.

Value is not created by infrastructure. Value is created by throughput.

Growth as a strategic illusion

IIn the current market phase, many providers follow a simple logic: more locations, more space, more presence. Real estate logic.

• But growth is not a competitive advantage.
• Growth is not protection.
• Growth is not a goal.

Without a clear strategic choice, expansion leads to fragmented networks, heterogeneous experiences, inconsistent quality, increasing complexity, and decreasing controllability. With each additional location, maintenance effort, risk of malfunction, quality variation, and probability of friction increase.

Expansion without trust dilutes quality. And diluted quality destroys return visits.

Differentiation or low cost

For context: My strategic understanding is closely aligned with Roger Martin’s school of thought. Not because I adopt his models, but because we share the same basic assumption: Strategy is not a plan or a forecast, but a structured theory about how value is created under uncertainty and decisions become effective. Like Martin, I do not focus on competition, but on the architecture of decisions, the ability to resolve goal conflicts, and the systematic connection of user logic, organization, and value creation.

Therefore, in my view, there are only two truly sustainable strategies: differentiation or low cost.

In the charging market, there is currently no real low-cost path. Low cost would require radical standardization, maximum process simplification, minimal services, extreme utilization, and uncompromising cost discipline. There is, so to speak, no „RyanCharge.“

Instead, most providers try to be simultaneously somewhat cheaper, somewhat better, somewhat more modern, and somewhat more convenient. The result is strategic ambiguity.

• Everyone looks similar.
• Everyone offers similar things.
• Everyone has similar prices.
• No one has a clearly defensible advantage.

In this state, price becomes a substitute for strategy. And price wars become a consumption of substance.

Trust as the only structural lever

In this market phase, there remains exactly one lever that simultaneously stabilizes utilization, increases volume, reduces fixed costs, defuses price wars, and secures investment capacity: trust.

• Not as an image campaign.
• Not as marketing.
• Not as a promise.

But as a system property. The start works. Aborts remain the exception. Performance meets expectations. The price is consistent. The location is predictable.

Not perfect systems win, but predictable ones. Not maximum performance scales, but minimal friction.

Bridge to market logic

From the user’s perspective, the question is: Will I come back here? From the provider’s perspective, it is: Am I stably utilized here? Both questions describe the same mechanism.

In the next part, it is about market logic: why utilization and trust are not opposites, but two sides of the same system.

Because in mature infrastructure systems, the following applies: Utilization arises from trust. And trust arises from utilization. Not as a metaphor. As an economic reality.

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Key Takeaways

• Charging infrastructure is not a product business, but a fixed cost-driven infrastructure system.
• Profitability is not determined by price, but by the volume of recurring processes.
• Margin is not a lever, but a result of utilization.
• Price shifts demand but does not stabilize it.
• Utilization is not a goal, but the result of trust.
• Utilization cannot be directly optimized—only trust can.
• Value is not created by inventory, but by throughput.
• Growth without trust dilutes quality and destroys return visits.
• Low cost is hardly achievable in charging—differentiation through trust remains the only defensible path.
• Trust is the only structural lever that reduces fixed costs, increases volume, and defuses price wars.