CEO of FLO EV Charging Solutions Louis Tremblay steps out in front of the company's latest prototype, an electric vehicle charger the company is promising will revolutionize the industry.
A sense of nervous anticipation hung in the air, at the Quebec City headquarters of FLO EV Charging Solutions, as its executives awaited the moment of truth for the biggest play in the brief history of Canada’s electric-vehicle charging industry.
As they sat down for interviews, in late June, FLO had just shipped the first of its new line of fast chargers, and the initial installation was under way in Pickering, Ont.
Branded the Ultra, the new model promises to charge most batteries to 80 per cent within 15 minutes. More than that, chief executive officer Louis Tremblay emphasized, it’s supposed to be all the things – reliable, convenient, even pleasant to use – that drivers complain public chargers are not.
FLO CEO Louis Tremblay demonstrates the company's new prototype.
That same day, at FLO’s manufacturing facility in Shawinigan, Que., site managers showed off a new, heavily automated assembly line ready to start making the company’s latest home EV chargers.
Scheduled to begin selling in August, three variations – from a relatively low-end plastic-encased model, through heavy-duty aluminum ones – will be priced much lower than previous versions, as FLO tries to crack further into a residential market in which cost is the biggest competition point.
Years from now, Mr. Tremblay predicted, the company he co-founded in 2008 – which boasts about 1.5 million public and residential battery charges each month, continentwide – will look back on this as the summer it successfully leveraged years of patient growth into a much bigger share of the North American charging market.
Whether the twin launches achieve that goal has major implications for Canada’s EV aspirations, on a couple of fronts.
The scaleup of the fast chargers is of particular domestic importance, as EV uptake – and pursuit of national climate targets – is held up by sparse or unreliable infrastructure.
Already a leading provider in this country, especially in the relatively developed markets of Quebec and British Columbia, FLO plans to install 1,900 Ultras at locations such as grocery stores and highway-side service stations in the next three years, with Ontario being the biggest target. That would represent a roughly 40-per-cent increase in all fast chargers nationwide, and a near doubling excluding Tesla Inc., which just started to make its ports available to other EV brands.
It’s also a test for domestic investment, including a recently closed $136-million equity financing round led by Export Development Canada, aimed at fuelling competitiveness in the international energy transition.
Although its presence in Canada is bigger, FLO has already made inroads in the United States, primarily through curbside chargers (slower models that can fit into urban areas where residents without driveways can’t charge at home) in large cities such as New York City and Los Angeles. But its ambitions, and likely its long-term financial viability, rest on whether the new products can capture larger shares of the fast-charging and home-charging U.S. markets, in which it doesn’t currently rank in the top 10.
To capitalize on those opportunities, FLO will have to overcome the tricky economics of a sector in which margins are narrow; competition for public contracts, private-sector partnerships and home customers is increasingly fierce; and looming elections, particularly in the U.S., could install less supportive governments.
It’s a challenge for which analysts generally believe FLO is relatively well positioned, having to this point scaled up more cautiously than competitors.
“It’s really all about brand reputation that’s going to get you more sales,” said Amaiya Khardenavis, an EV charging analyst with the international consultancy Wood Mackenzie, particularly referring to the U.S. market. “And I think they do have a good brand reputation compared to a lot of others.”
That reputation revolves around reliability. Experts interviewed for this story all said FLO is known among customers to suffer fewer glitches than other charging providers save for Tesla, although few comparative metrics for performance are publicly available (beyond self-reported ones such as FLO’s assertion of 98-per-cent uptime, meaning how often chargers are working).
In an industry plagued by horror stories about drivers being stranded by broken infrastructure, that’s a significant competitive advantage. The question now is whether it can be maintained while also prioritizing other consumer demands.
FLO employees work on the company's latest prototype at their offices in Quebec City.
“Up until now, FLO has had a sober approach to new product development,” said Jeff Turner, director of clean mobility at Dunsky Energy and Climate, a Montreal-based research firm. The downside, he said, has been not keeping pace with trends toward higher power and shorter charge times, although “their new fast charger should bring them right up to the front of the pack.”
The company’s aim to “delight EV drivers in terms of experience,” as Mr. Tremblay put it, also means responding to its market research showing that – as the EV sector starts to move beyond unusually tech-savvy early adopters – many potential customers find public chargers intimidating to use.
Chief product officer Nathan Yang said FLO has tried to address those concerns through design choices, ranging from mechanizing the chargers’ cables to make them less clunky for drivers to manoeuvre, to limiting stations’ height to make them less physically imposing.
As for boosting rather than compromising reliability, Mr. Yang said approximately 250 sensors have been built into the Ultras, versus about 50 in previous models. The sensors are meant to enable FLO’s Quebec City control centre to identify problems before they’re experienced by users, and either fix them remotely or dispatch technicians.
FLO’s organizational structure is also supposed to be key to its chargers breaking down less often than its competitors’. Unlike many other charging companies which are more specialized or outsource some of their functions, it takes direct ownership of everything from hardware to software to network operations, and bills that vertical integration as helping ensure accountability.
But the quality of the products and services is only one litmus test for that business model. It also needs to deliver financial stability, which is no less a question mark in its industry at the moment.
Loren McDonald, who heads the U.S.-based analytics firm EV Adoption, described a current environment in which many companies are conducting near-term downsizing and facing questions about their viability because fast-charging demand has yet to reach expectations. As a result, he said, the question of whether those companies will even be around in five years – and thus able to service their chargers – is now among buyers’ top concerns.
FLO’s precise financial situation is difficult to gauge because it’s not publicly traded. (Mr. Tremblay said in the interview that the company feels no near-term need to go public.) Asked for recent data, the company indicated that its total fiscal revenues were approximately $100-million in its 2023-24 fiscal year, while confirming it remains pre-profit, but did not state expenditures.
Available indicators seem positive. The recent financing round – which in addition to EDC included the Caisse de dépôt et placement du Québec, Investissement Québec and the Business Development Bank of Canada, as well as private firms – reflected strong support from Canadian institutional investors. It also has a close working relationship with Hydro Quebec.
Last year, FLO landed a $220-million loan from the Canada Infrastructure Bank, for the domestic fast-charger build out.
It’s also recently been growing its work force, from under 200 in 2021 to about 500 now, while competitors (such as Chargepoint, a vertically integrated U.S. company to which it’s often compared) have laid people off after scaling quicker.
A group of workers from Eastern Canada train at the company's offices.
Still, the path to profitability is hardly guaranteed and will be partly contingent on the success of a strategic shift in how FLO collects public-charging revenue.
Having mostly sold chargers to site hosts, FLO is moving toward an owner-operator model, in which it will forego sales revenues to be paid as chargers are used. That’s the plan for all 1,900 Ultra ports it plans to deploy in Canada, primarily starting with 500 through a partnership with the Metro grocery-store chain.
That won’t be the main approach in the U.S. yet, which Mr. Tremblay chalked up to a lack of similarly patient financing to what the infrastructure bank is providing.
The U.S. aim will be more incremental sales growth, especially through the National Electric Vehicle Infrastructure program, which is dispersing billions of dollars to states to install high-speed chargers. (There are mixed views about how much NEVI would be affected by a Donald Trump victory in November’s presidential vote, but FLO is nevertheless manufacturing the Ultras in Michigan, to meet the program’s domestic content requirements.)
Still, Mr. Tremblay indicated that he expects recurring revenue to gradually take over from sales revenue enough to eventually account for more than half of FLO’s total.
That’s a gamble, not least because most EV drivers usually charge at home. Fast public charging is a necessary option for when those drivers are travelling long distances, or otherwise out of their routines, but stations could nevertheless sit unused much of the time.
Mr. Tremblay responded that he believes Ultras will require only a couple of hours of daily use to be profitable, that the company has been in the market long enough to have a good sense of where it can maximize usage and that the product’s durability makes it a good long-term bet.
Meanwhile, the home-charger rollout also comes with risk.
There, too, FLO is touting upgrades on past versions, including greater power and network connectivity, with an eye toward time-of-use or other policies that power utilities might implement to manage rising electricity demand. It also sells them as being more durable than competitors’.
Still, the main difference with FLO’s new home models is that they’ll be dramatically cheaper than previous ones, which were expensive by industry standards. While the company has not yet announced the prices, its executives said they will need to be competitive with units made overseas (including in China) purchasable on Amazon.com Inc., which in some cases can be found for under $300.
That in turn will mean low per-unit margins, even with automation bringing down production costs, and a need for high sales volume in both Canada and the United States. Chief manufacturing operations officer Martine St-Onge said the Shawinigan plant will initially make up to 40,000 units per year but could go much higher by adding round-the-clock shifts if demand warrants.
In a perfect scenario, that demand surge will tie back to the public chargers.
FLO's head executives walk around their offices to see a prototype of their new fast-charging station.
There is some skepticism from charging-industry watchers about whether brand loyalty is yet a thing. But Mr. Tremblay is hoping it will become one.
“At some point, yes, you’re going to associate the brand with the service – that’s what we’ve bet on, years ago,” he said.
If a driver comes to count on FLO when out and about, he predicted, the likelier they’ll turn to it when replacing a broken charger at home.
Not that the two new products are where the company’s near-term ambitions and imperatives end.
Curbside charging remains a core offering, too, with ample room for further growth since many cities still lack it. At the Shawinigan plant, employees indicated that an assembly line currently still handling older products could be updated to make new curbside models, before too long.
Like so much else for the company, that may hinge on success coming out of this summer – particularly the leap forward in fast charging, which is palpably what the company is most excited about.
At its headquarters, employees were eagerly waiting to scrutinize the initial wave of data showing how the first installations, after all the usual extensive testing, are performing in the wild.
It will be the first indication of whether they, and anyone else with an interest in their role in EV growth, will indeed look back on this summer as fondly as they hope.