EVgo Has 1 Big Problem to Solve
EVgo (NASDAQ: EVGO) is at the forefront of a burgeoning industry. That is a good thing in some ways, but also a bad thing in others. As investors try to assess the growth opportunity offered by EVgo's efforts to build out an electric vehicle (EV) charging network, it's important to keep the cost of that effort in mind, too. Here's the big problem that EVgo has to solve if it wants to become a consistently profitable business.
EVgo builds and operates electric vehicle charging stations. This is vital infrastructure that is needed to support the transition from combustion engines to electric vehicles. While there are different dynamics in how each type of vehicle gets fueled (you can't realistically fill your gas tank up at home, but you can realistically charge an EV at home), widespread adoption of EVs will require a lot of charging infrastructure. Just think about how many gas stations there are in the world. Even if just half as many EV charging stations are needed, it will still be a huge infrastructure investment.
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Source Fool.com
