Tag: charging stations

Guest Post: Ancillary Service as a New Business Strategy–Turning EV Charging Time into Happier Customers and More Profitable Companies

Dr. Misty Blessley is Associate Professor of Supply Chain Management at West Virginia University. She can be reached at misty.blessley@mail.wvu.edu

In Module D of your Heizer/Render/Munson textbook, the psychology of customer wait times is discussed. Most would agree that waiting can be a painful experience. To make waiting less unpleasant, organizations often use distraction as a strategy. Some companies have mastered this approach by leveraging a strategic asset that transforms customer wait time into sales revenue. The rapid expansion of electric vehicle (EV) charging infrastructure provides a compelling example of how firms are creating a competitive advantage built around customer waiting.

According to a recent study, EV charging stations located near grocery stores experience usage rates nearly 5 times higher than stations in many other locations. This finding suggests that EV drivers prefer to combine charging with activities they already need to complete, such as grocery shopping. Rather than viewing charging as wasted time, customers can use that time productively while businesses benefit from additional sales that might otherwise have been lost.

Retailers have been quick to recognize this opportunity. Despite slowing EV sales, Walmart, along with other major retailers, is emerging as a significant player in the EV charging market. Industry experts estimate that charging stations located near retail stores can increase sales by approximately 5%. By 2030, it is projected that 1 in 5 fast-charging stations in the U.S. will be located in the parking lots of big-box retailers.

Restaurants are also capitalizing on this trend. Bojangles, for example, is expanding EV charging capabilities at select locations, recognizing that drivers waiting for their vehicles to charge are potential customers looking for a meal, snack, or comfortable place to relax.

This trend underscores the importance of service operations design. Companies are not simply deciding where to place charging stations, they are strategically integrating an ancillary service into locations where customer dwell time can be leveraged to create additional value. The charging station becomes part of a broader service system that ends with happier customers and more profitable companies.

Classroom Discussion Questions:

  1. Other than the firms mentioned here, what other types of businesses may/may not benefit from installing EV charging stations?
  2. Think of a time when you experienced the pain of waiting in line. What could the business have done to make the experience less unpleasant?

Guest Post: The Gas Station Life Cycle

Prof. Howard Weiss, retired from Temple U.,  shares his thoughts with our readers monthly.

The history of gasoline service stations provides an excellent illustration of life cycles as discussed in Chapter 5 of your Heizer/Render/Munson textbook

Before There Were Gas Stations The first practical gasoline-powered auto was developed in 1886 by Carl Benz. Prior to that, some inventors experimented with steam-powered vehicles, while others relied on kerosene because it was inexpensive, widely available, and burned efficiently. Early motorists purchased gasoline in bulk containers from pharmacies, blacksmith shops, or general stores and then poured the fuel into their vehicles using a funnel. Although this process seems inconvenient today, it was sufficient when automobiles were still a novelty.

Life Cycle Stage 1: Introduction

In 1905 the Automobile Gasoline Company opened the first gas station, in St. Louis. The station consisted of little more than a curbside pump with a hose, allowing motorists to fuel their vehicles directly instead of using portable containers. Gasoline sold for 25 cents a gallon. In 1913, the first drive-in service station opened in Pittsburgh, and also expanded the customer experience by offering free air, water, crankcase service, tire installation, and road maps.

Life Cycle Stage 2: Growth

During the growth stage, automobile ownership expanded rapidly, and so did the number of gasoline outlets. By the 1920s, major oil companies had standardized station designs and logos, creating recognizable national brands. Self-service fueling was introduced in the 1940s and became commonplace during the 1970s, reducing labor costs while increasing customer convenience. Today, many filling stations are combined with convenience stores such as Wawa, where merchandise sales often generate higher profits than gasoline itself.

Life Cycle Stages 3 & 4: Maturity and Decline

The number of gasoline outlets peaked at around 285,000 in 1975 and then entered a steady decline. Small independent stations found it increasingly difficult to compete with larger, multi-pump convenience stores that benefited from economies of scale and higher-margin retail sales. The number has been fairly constant at about 145,000 since 2000.

The growth of EV charging stations, beginning around 2007, interestingly, has not yet produced a corresponding decline in the number of gas stations. The future of gas stations will partially depend on the pace of EV adoption, but its history remains an excellent example that not all life cycles have the same shape.

Classroom Discussion Questions;

  1. What information would you want in order to forecast the number of gasoline outlets that will exist in 2040. 
  2. Could linear regression be used to forecast the number of electric charging stations in 2040? 

Guest Post: EV Charging– Driving Toward Universal Accessibility

 

Prof. Misty Blessley at Temple U. looks into an issue facing EV owners.

New Jersey is removing Tesla Superchargers from Turnpike and Parkway service areas and replacing them with universal chargers provided by Applegreen Electric. These new stations will feature CCS1, CHAdeMO, and J1772 connectors, making them compatible with a wider range of EVs. Tesla owners can use these chargers with adapters. Most newer Tesla models can accommodate J1772 (Level 2) and CCS (DC fast charging) connections through external adapters.

This shift reflects a broader trend toward open-access infrastructure aimed at increasing accessibility for all EV drivers. It also introduces new OM considerations around the production, availability, and use of adapters.

The Shift Toward Open Infrastructure
New Jersey’s decision mirrors historical tech battles between proprietary systems and open standards. Tesla, like Apple in its early days, built a closed ecosystem. The state’s move to universal chargers signals a shift toward interoperability over exclusivity. As one article put it, “Up until recently, the vast network of more than 1,600 Tesla Supercharger fast EV charging stations in the U.S. was a perk exclusive to Tesla owners.” That exclusivity is
now being replaced with inclusivity, with the cost falling on Tesla drivers now being dependent on an external device.

In this context, adapters become the modern equivalent of USB driver software, seemingly minor components that play a major role in user experience and system reliability.

Adapter Implications for Operations and Supply Chain
 Forecasting and Demand Planning: Widespread reliance on adapters will drive new demand. Manufacturers must scale production, distribution, and after-sales support.
 Inventory Management: Retailers and even rest stops may need to stock or rent adapters, creating SKU complexity.
 Station Capacity: Adapters can increase setup time, and Level 2 chargers provide only 13–25 miles of range per hour—far slower than Tesla’s V3 Superchargers (over 200 miles in 15 minutes), potentially reducing the number of EVs that can be charged at a station.

 Risk and Reliability: Adapters introduce new points of failure because they are mechanical devices prone to wear, damage, or user error. This raises customer service and warranty cost concerns.

Classroom discussion questions:
1. In Ch. 11 of your Heizer/Render/Munson textbook, component standardization is discussed. What are the benefits of standardizing EVs and charging stations?
2. What advice would you provide to operations managers on the adapter implications mentioned above?

OM in the News: Electric Big Rigs Hit the Street, but Chargers are Scarce

Heavy-duty electric trucks are rolling out across the country. But “the electric grid upgrades and equipment needed to plug them in aren’t,” writes The Wall Street Journal (July 17, 2023).

California plans to require new trucks to be zero-emissions by 2036.

As automakers deliver new electric trucks to fleet customers, parking lots that once needed enough power for a few floodlights now might need to draw as much power as a skyscraper. But the necessary grid improvements could take years.  In January, California utility PG&E told some large fleet customers they wouldn’t be able to charge trucks for a few years during summer afternoons when California electricity use peaks. Capacity upgrades would take at least until 2026, said PG&E.

Similar issues are popping up across the U.S. as firms place larger EV truck orders.  “One or two trucks, everybody’s got. It’s when they try to do their fleets,” said the CEO of Exelon, an eastern U.S. utility company.

The challenge is especially acute in California, where drayage trucks, which carry containerized cargo to and from ports and rail centers, face a looming deadline. The state will require any new drayage trucks to run on electric batteries or hydrogen fuel cells. California also plans to phase out sales of new gasoline-powered passenger cars, pickup trucks and SUVs by 2035 and require all new medium- and heavy-duty truck sales be zero-emissions by 2036.

Electric trucks have the potential to reduce air emissions for communities by eliminating diesel use. Trucks represent 6% of the vehicles on California’s roads, but a quarter of the state’s on-road greenhouse-gas emissions. California forecasts it will have 180,000 medium- and heavy-duty zero-emission vehicles by 2030 that would need 157,000 chargers, many of those at depots operated by the fleet owners. There are fewer than 700 chargers at depots now.

Fleet owners must figure out how to install chargers at their depots, a complex engineering and power management task. Chargers will also be needed on the road but there is no network of electric truck stops yet. California has the most EV fast chargers for regular passenger cars nationally, but those sites aren’t designed to fit industrial vehicles. As fleets add trucks they will need to draw at least 6 to 8 more megawatts of power. That’s about 1,000 homes.

Classroom discussion questions:

  1. As a fleet manager, what is your strategy?
  2. As a power company such as PG&E, what is your capacity strategy?