A few years ago, we helped a disenchanted Air Force veteran with a strategic blue-state evacuation, by liquidating his Illinois truck stop. On the day of closing, he was about as happy as if it was the birth of his first child, knowing that he and his crew were moving to an oft dreamed-about red-state nirvana.

His Tesla charging area, with its eight to 10 idle charging stations, helped verify my notions on the long-term prospects of electronic vehicles (EVs) given the current approach. I’ll not belabor all the limitations, from charging infrastructure to motorist demand, or the incessant regulatory pressure fueled by the illogical green movement intent on forcing this down our throats. The result is a race to pepper the country with charging stations, in anticipation of a wave of EV use that may never materialize. I’m sure that the early adopter retailers know that they are making the investment more for image than any realistic profit expectation.

Don’t get me wrong, I don’t hate the notion of EVs, just the way we, as a country, have been embracing them. Yet there currently exists a much better approach that could be extremely lucrative for petroleum retailers, if we were to throw out much of what has already been done and refocus the effort.

Three To Five Minute Charging

Recent news reports indicate that China is intent on flooding our country with EVs. Now these aren’t your run of the mill government-foisted boondoggle EVs with no meaningful profit potential for petroleum retailers. They have the potential of being a very lucrative money-making proposition for our retail industry.

Two Chinese EV car brands, Nio and Geely, have developed vehicles that enable their spent batteries to be swapped out for fully charged ones in three to five minutes. Think about the business applications for cars that can be recharged in the same amount of time it takes to fill up a gas tank. Motorists will no longer have to kill time waiting somewhere in the middle of nowhere while their car charges, in the hopes that they can get to their ultimate destination while they are still young. Even better, there is no need for government incentivized charging stations or the unprofitable investments it takes to join the EV charging bandwagon.

Swap-Out Batteries

If the concept of “swap-out” batteries is universally embraced, the retail profit potential would be enormous.

Imagine the Blue Rhino propane tank exchange concept and apply it to EV batteries, but with a much higher profit potential. With the time-to-recharge hurtle largely overcome, EV’s would become much more desirable and prevalent, making universal retailer adoption of a swap-out program a no-brainer.

Depending upon size and sophistication, participating retailers would have two distinct revenue opportunities: Offering drop-off/swap-out batteries like a propane exchange program or onsite charging where the retailer manages a greater degree of the process, swapping-out batteries as part of a battery franchise network.

The crazy thing is that this is not some futuristic pie-in-the-sky concept. The swap-out battery technology currently exists. Despite its infinite logic, its potential may unfortunately be unattainable, as the technology resides with the wrong country; the current impetus of building charging stations may be unstoppable, given the high sunk costs; and the auto manufacturers vested interest in this approach may be too far gone to compel anyone to alter this expensive and misguided course. Quite a testament to why government should never be involved with economic influence.

Despite all these limitations, the swap-out EV approach should be explored further given the many positive aspects, including the potential for high retail participation and profit benefits. Maybe a licensing agreement or joint venture with the Chinese car companies to explore all the possible angles for a redirection of the current approach.

A comprehensive battery swap-out initiative is probably the only way to compel enough motorists to embrace EVs to maintain the relevance of the industry into the future.

Mark Radosevich is a recognized industry advocate, possessing over 40 years of continuous petroleum industry engagement. He is president of PetroActive Services (www.petroactiveservices.com) and can be reached at: [email protected] or 423-442-1327.