EV Charging Profitability Case Interview: Worked Case
| Case type | Profitability |
|---|---|
| Industry | Energy / EV Charging |
| Difficulty | Medium |
| Firm style | McKinsey |
What does the EV charging case ask you to fix?
Voltigo operates 60 fast EV charging sites across France, serving both retail drivers and discounted fleet customers, primarily on highways and in major cities. Despite strong growth in EV adoption, Voltigo posted an operating loss in twenty twenty five after being profitable in prior years. The CEO wants a plan to return to profitability in twenty twenty six without materially harming customer satisfaction or network reliability.
Voltigo runs 60 DC fast-charging sites (average 8 stalls per site), with two customer segments: retail drivers (pay-as-you-go) and fleet customers (discounted contracts). In twenty twenty five, France's grid tariff changed for high-power connections, increasing demand charges tied to each site's monthly peak kW. Management suspects costs increased faster than pricing and utilization improvements, and wants a clear diagnosis and practical plan.
Which exhibits test the utilization economics?
Exhibit 1
2025 P&L by Customer Segment (€M)
Show the data behind Exhibit 1
| Segment | Revenue (€M) | Energy Cost (€M) | Demand Charges (€M) | Other Variable Costs (€M) | Fixed Costs (€M) | Operating Profit (€M) |
|---|---|---|---|---|---|---|
| Retail (pay-as-you-go) | 62.0 | 34.1 | 10.8 | 1.1 | 18.5 | -2.5 |
| Fleet (contracted discounts) | 18.0 | 10.5 | 3.2 | 0.6 | 9.2 | -5.5 |
| Total | 80.0 | 44.6 | 14.0 | 1.7 | 27.7 | -8.0 |
Exhibit 2
| Site Type | % of Sites | Sessions/Day | Avg kWh/Session | Blended Price (€/kWh) | Energy Cost (€/kWh) | Peak Demand (kW) | Demand Charge (€/kW-month) | Fixed Site Opex (€/month) |
|---|---|---|---|---|---|---|---|---|
| Highway Hub | 40% | 220 | 45 | 0.55 | 0.31 | 1,000 | 25 | 35,000 |
| City Hub | 60% | 200 | 30 | 0.52 | 0.30 | 800 | 25 | 20,000 |
Exhibit 3
Monthly Peak Pattern (Illustrative Load Curve)
Representative daily load profile for a typical site. Monthly peak kW is set by the highest single interval (e.g., 18:00 at 1,200 kW), which drives the demand charge for the entire month.
Show the data behind Exhibit 3
| Hour | Avg Site Load (kW) | % of Monthly Peak |
|---|---|---|
| 06:00 | 180 | 15% |
| 07:00 | 420 | 35% |
| 08:00 | 900 | 75% |
| 09:00 | 540 | 45% |
| 10:00 | 360 | 30% |
| 11:00 | 300 | 25% |
| 12:00 | 780 | 65% |
| 13:00 | 960 | 80% |
| 14:00 | 480 | 40% |
| 15:00 | 360 | 30% |
| 16:00 | 420 | 35% |
| 17:00 | 1,080 | 90% |
| 18:00 | 1,200 | 100% |
| 19:00 | 840 | 70% |
| 20:00 | 540 | 45% |
| 21:00 | 300 | 25% |
| 22:00 | 180 | 15% |
McKinseyProfitability · medium
Voltigo FastCharge Turnaround
Energy / EV Charging
How a strong candidate structures it
Goal: Return to profitability while maintaining customer satisfaction and network reliability.
Hypothesis: Profitability declined because cost growth outpaced realized revenue, with losses concentrated in a subset of locations or customer cohorts.
Question by question
- 1
Case context
Restate the situation and objective
“What is the client situation and what question are you being asked?”
- 2
Clarifying
Clarifying questions
“What questions do you have for this case or what information would you like to know before starting?”
- 3Drill the structure
Structure
MECE profitability structure
“How would you structure your analysis of this profitability problem?”
- 4Drill the brainstorming
Analysis
Segment Profit Diagnosis
“Using Exhibit 1, identify where the €8M operating loss comes from and the segment Voltigo should focus on first.”
- 5Drill the math
Math
Site Economics Math
“Using Exhibit 2, calculate monthly energy margin and then net monthly profit for Highway Hubs and City Hubs. Assume 30 days per month.”
- 6Drill the brainstorming
Analysis
Peak Demand Levers
“Using Exhibit 3, explain what the peak pattern implies about demand charges and name two practical ways to reduce peaks.”
- 7Drill the synthesis
Synthesis
Final Recommendation
“What is your recommendation to the CEO?”
The worked path
The numbers that decide it
- Fleet accounts for EUR5.5M of the EUR8M allocated 2025 loss, or 68.75%; fixed-cost avoidability is unknown.
- Demand charges total EUR14M in the network P&L; no full prior-year cost bridge is supplied.
- Typical-site math gives EUR11,280 monthly Highway profit and negative EUR400 City profit before corporate overhead under the listed inputs.
- Scaling 24 Highway and 36 City archetypes gives EUR15.84M annual demand charges, not an exact reconciliation to EUR14M.
- Exhibit 3 peaks at 1,200 kW at 18:00; under the billing rule that single monthly peak, not total energy, sets the demand charge.
- Pilot fleet pricing and peak management against incremental profit, retention, wait time and reliability outcomes.
Final synthesis
Use Exhibit 1 to identify the allocated loss: Retail negative EUR2.5M and Fleet negative EUR5.5M. Do not infer avoidable loss or a quantified year-on-year cause from one P&L. Exhibit 2 yields Highway energy margin of EUR71,280/month less EUR25,000 demand charges and EUR35,000 site costs = EUR11,280. City energy margin is EUR39,600 less EUR20,000 demand charges and EUR20,000 site costs = negative EUR400. The site examples exclude corporate overhead and differ from network totals beyond fixed costs, so do not invent a complete reconciliation. Exhibit 3 peaks at 1,200 kW at 18:00, the interval that sets that site's monthly demand charge. Under the case billing rule, savings come from lowering the billed monthly peak, not just total energy. Test fleet scheduling, pricing and load management with a profit bridge to the EUR8M gap, measuring churn, queues and reliability. Avoid double-counting demand-charge savings, extra volume and pricing effects.
McKinseyProfitability · medium
Voltigo FastCharge Turnaround
Energy / EV Charging
Why this case
Generic profitability cases rarely make a tariff rule the central driver. This EV charging scenario tests whether you connect a few peak-load intervals to a monthly demand charge, then trace that cost through customer and site segments. The industry trap is fleet discounting: fleet loses €5.5M despite €18.0M of revenue, while city hubs are only marginally unprofitable. The recommendation must protect reliability while changing price and load behavior.
FAQ
- Which segment should you fix first?
- Start with fleet. It loses €5.5M, compared with €2.5M for retail, so it represents the larger share of the €8.0M network loss. Review discounted contract terms, minimum fees, and charging-time incentives first. Keep retail in scope because it is also negative, but fleet economics offer the clearest initial turnaround target.
- Why are demand charges so important?
- Demand charges are based on each site’s monthly peak kW, not average utilization. A few high-load intervals can set the charge for the entire month, so simultaneous charging can erase energy margin. In the case, demand charges total €14.0M. Peak/off-peak pricing, fleet time windows, and software load management directly address that mechanism.
- Which sites are profitable?
- Highway hubs are stronger: at 220 sessions per day and 45 kWh per session, a typical site produces about €11,280 in monthly net profit after energy margin, demand charges, and fixed opex. City hubs run at about negative €400 per month because shorter sessions and a narrower price-cost spread leave little room for fixed costs.
- How can Voltigo improve profitability without hurting customers?
- Use targeted pilots instead of a broad service cut. Renegotiate fleet discounts, offer off-peak incentives, and apply load management to reduce simultaneous peaks. For city hubs, test utilization and lease improvements. Monitor customer satisfaction, charger availability, peak kW, fleet retention, and site profit so reliability remains a hard guardrail during the turnaround.
McKinseyProfitability · medium
Voltigo FastCharge Turnaround
Energy / EV Charging