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◆ WSJ NEWS EXCLUSIVE
Germany’s Volkswagen Nears Deal to Sell Stake in Electrify America to Siemens
Transaction would value electric vehicle recharging business at more than $2 billion
Volkswagen AG, maker of the iconic Porsche sports car, is close to selling a minority stake in its U.S. electric vehicle recharging business to an arm of Siemens AG, a deal that would value the network at more than $2 billion, according to people familiar with the matter.
A sale of a stake in Volkswagen’s Electrify America LLC would generate additional funding as part of a plan to more than double the number of EV recharging stations Electrify America operates across the U.S. and parts of Canada to 1,800 by 2026. Reston, Va.-based Electrify America also offers EV charging stations for use at home.
The deal is expected to be announced as soon as Tuesday, assuming talks don’t break down.
Germany-based Siemens would make the investment through its Siemens Financial Services unit, according to the people. The deal would complement Siemens’s existing operations in the EV recharging sector. In August, the engineering and technology giant announced plans to expand its manufacturing operations in the U.S. as part of a plan to make over 1 million EV chargers for that market over the next four years.
In the U.S., Siemens manufactures charging equipment for buses, trucks and heavy-duty electric vehicles at its facility in Wendell, N.C. It also has EV-focused operations in Texas, California, South Carolina and Georgia.
Bets on recharging networks are supported by a doubling of EV auto sales in the U.S. last year. However, that amount accounted for only a fraction of the U.S. car market, highlighting the challenges recharging infrastructure faces generating sustainable profits. An analysis by consulting firm AlixPartners in 2020 showed that the average fast-charging station, charging market price for electricity, would take 20 to 25 years to pay off its initial investment.
Electrify America expects to spend $2 billion on its expansion in coming years, partly funded by the Siemens investment.
Volkswagen, which is based in Wolfsburg, Germany, formed Electrify America in 2016. That was part of an effort to show renewed commitment to clean vehicles after U.S. regulators accused the auto giant of installing so-called defeat devices on diesel cars that misstated emissions levels.
Governments and regulators have pushed traditional auto makers to phase out production of fossil-fueled powered cars in favor of electric ones. The success of some EV companies, led by Tesla Inc., is driving demand and funding for a faster rollout of recharging stations. Mass adoption of clean-energy vehicles depends on drivers having confidence that they can recharge their cars quickly when traveling.
Telsa operates one of the largest recharging networks globally but it has only been available to owners of the company’s cars. In November, the EV maker started to open the infrastructure to non-Tesla vehicles in parts of Europe including France, the Netherlands, U.K. and Norway to encourage wider EV adoption. Texas-based Tesla said it continues to expand this service to new sites and countries.
Telsa says its Supercharger technology allows users to charge their cars for up to 200 miles in 15 minutes. Electrify America says its charging technology is the fastest on the market, according to the website.
Utilities and governments also are seeking to expand the availability of recharging facilities. The Electric Highway Coalition, whose members include Duke Energy Corp. and American Electric Power, is seeking to build an EV charging network spanning much of the U.S. South, Midwest and East Coast.
The U.S. government allocated $5 billion of the $1 trillion federal infrastructure bill to help create a national network of EV station
Germany’s Volkswagen Nears Deal to Sell Stake in Electrify America to Siemens
Transaction would value electric vehicle recharging business at more than $2 billion
Volkswagen AG, maker of the iconic Porsche sports car, is close to selling a minority stake in its U.S. electric vehicle recharging business to an arm of Siemens AG, a deal that would value the network at more than $2 billion, according to people familiar with the matter.
A sale of a stake in Volkswagen’s Electrify America LLC would generate additional funding as part of a plan to more than double the number of EV recharging stations Electrify America operates across the U.S. and parts of Canada to 1,800 by 2026. Reston, Va.-based Electrify America also offers EV charging stations for use at home.
The deal is expected to be announced as soon as Tuesday, assuming talks don’t break down.
Germany-based Siemens would make the investment through its Siemens Financial Services unit, according to the people. The deal would complement Siemens’s existing operations in the EV recharging sector. In August, the engineering and technology giant announced plans to expand its manufacturing operations in the U.S. as part of a plan to make over 1 million EV chargers for that market over the next four years.
In the U.S., Siemens manufactures charging equipment for buses, trucks and heavy-duty electric vehicles at its facility in Wendell, N.C. It also has EV-focused operations in Texas, California, South Carolina and Georgia.
Bets on recharging networks are supported by a doubling of EV auto sales in the U.S. last year. However, that amount accounted for only a fraction of the U.S. car market, highlighting the challenges recharging infrastructure faces generating sustainable profits. An analysis by consulting firm AlixPartners in 2020 showed that the average fast-charging station, charging market price for electricity, would take 20 to 25 years to pay off its initial investment.
Electrify America expects to spend $2 billion on its expansion in coming years, partly funded by the Siemens investment.
Volkswagen, which is based in Wolfsburg, Germany, formed Electrify America in 2016. That was part of an effort to show renewed commitment to clean vehicles after U.S. regulators accused the auto giant of installing so-called defeat devices on diesel cars that misstated emissions levels.
Governments and regulators have pushed traditional auto makers to phase out production of fossil-fueled powered cars in favor of electric ones. The success of some EV companies, led by Tesla Inc., is driving demand and funding for a faster rollout of recharging stations. Mass adoption of clean-energy vehicles depends on drivers having confidence that they can recharge their cars quickly when traveling.
Telsa operates one of the largest recharging networks globally but it has only been available to owners of the company’s cars. In November, the EV maker started to open the infrastructure to non-Tesla vehicles in parts of Europe including France, the Netherlands, U.K. and Norway to encourage wider EV adoption. Texas-based Tesla said it continues to expand this service to new sites and countries.
Telsa says its Supercharger technology allows users to charge their cars for up to 200 miles in 15 minutes. Electrify America says its charging technology is the fastest on the market, according to the website.
Utilities and governments also are seeking to expand the availability of recharging facilities. The Electric Highway Coalition, whose members include Duke Energy Corp. and American Electric Power, is seeking to build an EV charging network spanning much of the U.S. South, Midwest and East Coast.
The U.S. government allocated $5 billion of the $1 trillion federal infrastructure bill to help create a national network of EV station
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