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The introduction of US tariffs in 2025 is poised to reshape the electric vehicle (EV) charging market, influencing the cost and availability of critical components like copper wiring, steel, and transformers. According to IDTechEx, these tariffs will increase production costs for charging hardware and potentially delay large-scale projects, though domestic sourcing and contingency budgets may mitigate some effects. While the tariffs pose challenges, they could also spur innovation and domestic manufacturing in the EV charging sector.
Key Highlights:
- Tariffs on copper and steel may raise costs for EV charger cables and enclosures.
- Switchgear and transformer costs could increase due to tariffs on steel and aluminum.
- 80-90% of electrical materials are domestically sourced, reducing tariff exposure.
- Large DC charging projects face delays due to imported transformer shortages.
- Project cost increases of 10-13% are expected for projects without grid upgrades.
- Domestic production of chargers aligns with Buy America requirements.
Impact on Charging Hardware The tariffs target materials like copper, steel, and aluminum, which are essential for EV chargers. Copper wiring, critical for power transmission, may see price hikes, pushing manufacturers to source domestically or explore alternative suppliers. This could extend lead times and elevate costs. Similarly, steel and aluminum tariffs (currently at 25%) will likely increase the cost of charger enclosures, mounting systems, and switchgear components. Some companies may pivot to composite materials to reduce reliance on tariffed metals, though this could require costly redesigns.
Transformer Challenges Transformers, vital for DC fast chargers, are a significant cost driver. With 80% of US transformers imported, primarily from Mexico and China, tariffs and long lead times exacerbate supply chain bottlenecks. In 2024, the US imported $29.2 billion in transformers, highlighting the scale of dependency. The lack of domestic transformer production remains a critical hurdle for large public charging projects.
Domestic Sourcing as a Buffer Approximately 80-90% of electrical construction materials, such as conduits and panels, are made in the US, and imports from Mexico often qualify for tariff exemptions under the USMCA. This domestic focus, combined with unaffected labor and soft costs, limits overall project cost increases to 10-13% for smaller projects. EV charger manufacturers, prepared by years of aligning with Buy America policies, are also ramping up local production to counter tariff impacts.
Looking Ahead While tariffs risk slowing EV charging infrastructure growth by raising costs and complicating supply chains, they may accelerate domestic manufacturing and material innovation. IDTechEx suggests that stakeholders monitor tariff developments and invest in local production to navigate these challenges effectively.
For further insights, visit IDTechEx’s research portal or explore their EV charging market reports at www.IDTechEx.com/EVChargingResearch.
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