Implications of Public Charging Stations With Pay-Per-Use Service Mode on Electric Vehicle Adoption

Although many researchers have found that EV adoption depends heavily on charging infrastructure, few studies have investigated whether and how additional public charging stations operating under the Pay-Per-Use (PPU) mode affect EV adoption. In this mode, consumers pay for usage but do not obtain ownership of the product. To fill this gap, we develop two theoretical models in which a manufacturer sells EVs and private charging piles, while an independent operator provides public charging stations via the PPU mode. We confirm that the entry of public charging stations improves EV adoption. However, contrary to conventional wisdom, our analysis reveals that, although the PPU mode reduces the optimal quantity of private charging piles, it may increase private charging piles' optimal prices and profits. Moreover, decreasing the operational costs of public charging stations benefits the manufacturer and consumers but may not always be profitable for the operator. To assess the robustness of our findings, we extend the models to two scenarios: including multiple EV manufacturers and considering consumer waiting at public charging stations. Besides confirming our main results, the extensions yield two additional findings: (i) As the number of manufacturers in the market increases, the operator's profits decrease. (ii) Consumer waiting costs, dependent on the proportion of public charging infrastructure, negatively affect the public charging and EV markets while benefiting the private charging pile market.