By Epiphany Communications and Coaching*
As Electric Vehicles (EVs) gain popularity, many are asking: What will happen to gas stations? Although MIRA members are primarily located in the Midwest of the United States, it might behoove members to look to states like California to assess the future of gas stations. California’s shift away from gas-powered vehicles could mean as many as 80% of gas stations would be unprofitable by 2035, according to some experts. The state has some 250,000 station owners and employees.
Gas stations have evolved over the years and have been a part of the country’s culture offering fuel, food, and friendly directions along back roads and byways, but how will that change as EVs are hitting the roads?
Already, fewer cars are gas-guzzlers, reducing demand for fuel. Not only are a growing number of cities banning new station construction, but manufacturers are also producing less gas-guzzlers, reducing the demand for fuel.
Motorists typically stop at a gas station for a quick in-and-out stop. They pump gas and pay at the pump; these stations are often located on busy routes and can be low cost, high-volume businesses.
With EV cars, there is a different demand. Charging them takes time so adding diners and other food establishments to the station or a quaint coffee shop gives the motorists something to do while waiting for the vehicle to charge. Many gas stations have partnered with food establishments over the years.
Gas stations owners are in survival mode. They are testing more sustainable sources of revenue, adding car washes, and expanding their store offerings. Increasingly, they sell not just coffee and cigarettes but also fresh sandwiches, organic juices, pizza, hot dogs or are teaming up with other chain stores like Tim Hortons, Dunkin, and Burger King.
Meanwhile AAA reported in mid-April that Gas prices in Michigan declined slightly after setting a new 2023-high of $3.72 on Saturday, April 15th. Michigan drivers are now paying an average of $3.71 per gallon for regular unleaded, which is 9¢ more than in early April. This price is 22¢ more than the same time in March but still 20¢ less than this time last year.
Motorists are paying an average of $55 for a full 15-gallon tank of gasoline; a discount of about $23 from 2022’s highest price last June.
According to new data from the Energy Information Administration (EIA), gas demand decreased from 9.3 to 8.94 million b/d. Meanwhile, total domestic gasoline stocks dropped slightly by 400,000 bbl to 222.2 million bbl. Lower demand would typically push pump prices down; instead, elevated oil prices have pushed them higher.
According to the Ford Media Center, Ford began production of an all-new electric passenger vehicle, a medium-sized crossover, built in Cologne with a second electric vehicle added to the Cologne production line-up in 2024. In addition, Ford’s top-selling passenger vehicle in Europe, the Ford Puma, will be available as an electric version made in Craiova, Romania, starting in 2024.
Ford targets to become all-electric for their passenger car lineup in Europe by 2030 and two thirds of commercial van sales to be all-electric or PHEV (plugin hybrid electric vehicle) by the same date, according to reports.
Kevin Bahnam, president of USA 2 Go, has been adding charging stations at his establishments in recent months, “however, the stations today are not economically efficient,” he noted. “The cost is too high, and the demand is still very low. We are adding it on as another service offered to customers to maintain traffic. That is where it stands today. It is going to change for sure, but we don’t know exactly how.”
Technology changes quickly and that includes charging stations. “We hope once the new generation chargers drop the charging time to an average five minutes, it will be more of a destination,” said Bahnam. “It’s almost like the big players are in a waiting mode. They won’t want to jump into it quickly because it is costly. The return on the investment is not there yet even with the state and federal grants.”
*Writers with Epiphany Communications and Coaching are content creators for Bottom Line.