Posts

The Handelsblatt recently reported on long waiting times at electric car charging stations. How can these annoying queues be avoided during charging stops? Pricing expert Prof. Hans-Christian Riekhof has a suggestion.

Charging Station Queues for Electric Cars: Control Demand through Pricing Mechanism?

/in , /by

Long waiting times at charging stations for electric cars? The Handelsblatt reported on this on 02.09.2024. In the summer, many people who were on the road on Germany’s motorways experienced the annoyance of occupied fast chargers. At the same time, there is talk of overcapacity of charging stations in Germany. How does this fit together, Catania Krapp from Handelsblatt asked in her article titled “Why do electric car holidaymakers often wait for free fast chargers?”

Charging station provider Ionity: Demand lags behind

Torsten Kiedel, CFO at the fast charging station provider Ionity, contradicts in the report the accusation that the charging station utilization is too high and explains that the demand is currently rather lagging behind the expansion. Regardless of the expansion: the ratio ’15 electric cars to one charging point’ remains the same.

Charging stations for electric cars: it gets full at the beginning and end of the holidays, but also on Fridays and Sundays

For many holidaymakers, such queues would have meant hanging around in the car next to the fast chargers until someone else has finished charging, also to make sure that no other waiting driver pushes in, the newspaper writes. A charging stop of 20 minutes could thus already take twice as long. The report quotes Peter Wüstnienhaus, an expert on electromobility for many years. Especially at the beginning and end of the holidays, but also generally on Fridays and Sundays, the risk is high that the charging stations will be full, he says. He has already experienced having to wait at the A1 on Sunday evenings at 10 p.m. because all four charging points were occupied.

Pricing expert Prof. Riekhof: Control demand at charging stations through pricing mechanism

With regard to the defined goal that the number of electric cars should increase from currently 1.5 million to 15 million by 2030, the Handelsblatt asks whether the charging station infrastructure is prepared for this and how electric car drivers can avoid queues.

Prof. Dr. Hans-Christian Riekhof (UNICconsult Strategy Development) believes that the most important topic is not addressed in this exciting report, namely how demand can be controlled. His answer: through a pricing mechanism. “Do electric car drivers know the price difference between providers and the gap between fuel costs and the cost of electricity per 100 kilometers?”, asks the pricing specialist. “Do providers rely on Peek Load Pricing? Do prices change during the day, during the week or according to the seasons?” Unfortunately, you don’t find out about this. At least that’s how the oil companies do it. “It would be interesting to make a comparison here”, says Riekhof.

Photo: © Joenomias/pixabay.de

Business Unit VW Group at Leoni: Dynamics of Change in Pricing

/in /by
Peter Becker Leoni

As part of the study on pricing processes in the automotive supplier industry, Prof. Dr. Hans-Christian Riekhof conducted an interview with Peter Becker, Head of Business Unit VW Group at Leoni.

Professor Riekhof: Are there research results from our study on pricing processes at automotive suppliers in 2017 that particularly caught your eye and that you did not expect?

Peter Becker: No, although the result is quite sobering, the study provides a very clear and, in my view, honest picture of the current state of the industry in terms of pricing.

Riekhof: What changes is pricing in your industry undergoing? Is there a certain dynamic of change or are prices established today in the same way as ten years ago?

Becker: From my point of view, there is a decent dynamic of change. Changes are slow to take effect, but are driven by the industry’s desire to increase the professionalism and profitability of business transactions.

Riekhof: The automotive industry is currently undergoing a profound change towards the expansion of electromobility in its various forms. Does this also change the framework conditions for strategic pricing? Will it become easier for suppliers to differentiate themselves in their value contribution, so that price pressure may also decrease?

Becker: Yes, I see it that way. The change in this time is very fast. Furthermore, industry partners are more dependent than ever on mastering the challenges together. Creating value and offering new services also allows differentiation with corresponding positive effects on pricing.

Riekhof: What opportunities do you see for value-based pricing (Value-Based Pricing) at Leoni?

Becker: The chances for value-based pricing at Leoni are good. Appropriate measures are slowly being introduced into the company. However, your study’s statement that the focus on profit improvement measures mentioned still enjoys higher priority today is correct.

Riekhof: Are there tools and procedures in your company as part of pricing management that you would describe as groundbreaking? Or does your pricing follow industry-standard rules and practices for good reason?

Becker: Personally, I do believe that the “industry-standard” approach needs to be questioned in one place or another. Innovative ideas and above all focused approaches in companies in terms of pricing can create new tools for pricing. We at LEONI are doing this, and under the program headline “Sales Excellence” several concrete approaches are bundled.

Riekhof: Leoni has very different business areas that operate their market segments with high autonomy. Are there processes in your company to define cross-divisional pricing strategies for certain customer and market segments?

Becker: Yes, there are very different business areas at LEONI. However, where the mechanisms at the customer are the same, e.g. in our business area WSD of LEONI (on-board networks), an approach is feasible to optimize processes across divisions and customers, and we are working on it.

Riekhof: To what extent have you already exploited the value creation potentials in your company that lie in professional pricing?

Becker: On a scale of 1 to 10, I would – as of today – settle for 4. So there is still a lot to do. But we are moving in the right, value-creating direction!

Back to Pricing Strategies