In the summers before the pandemic, when Ottawa resident and Tesla owner Mari Teitelbaum made her regular visits to Norway, she’d be greeted by a familiar sight: the famous red and white signage of Circle K, the biggest global convenience-store brand of Alimentation Couche-Tard.

With its Scandinavian presence, the Laval, Que.-headquartered convenience-store giant bridges two car cultures that for all their similarities—areas with frigid, mountainous conditions, a scattered population and rich fossil-fuel reserves—have one key difference: Norway has converted around half its annual new car sales to battery-electric vehicles, according to the International Monetary Fund. In Canada, meanwhile, zero-emissions vehicles represented 3.5 per cent of new vehicle registrations last year.

Canadian officials want to see that number jump dramatically in the next 10 to 15 years, posing a challenge for a company like Couche-Tard, which sells fuel at 10,800 of its 14,200-plus stores. Electric vehicles take longer to charge, often cost less to refuel, use chargers that don’t work in every car brand, and, most importantly—many EV owners can refuel at home. 

Norway’s quick transition to electric vehicles could have seen Couche-Tard’s business there peter out. A BCG report grimly predicted in 2019 that up to 80 per cent of fuel retail locations may be unprofitable in the following 15 years amid the transition to electric and autonomous vehicles. Instead, Circle K is setting the bar for what electric-vehicle charging stations can offer drivers. And while the company doesn’t break out its financial results by country, it said last month that same-store sales in its most recent quarter were especially strong in Europe. On the earnings call, CEO Brian Hannasch said its efforts in Norway are “building the foundation” for its future North American business. 

“Electric-vehicle adoption is a longer-term concern, but critical penetration is well in the distance and [Couche-Tard] has Norway as its testing ground,” wrote CIBC Equity Research analysts Mark Petrie and John Zamparo in a Sept. 1 research note.

Yet outside its corporate events, the company has said little to North American press about its plan for an electric future. It declined two interview requests and did not respond to a question from The Logic about its recent financial results and annual meeting. But a look at Circle K’s presence in Norway offers hints of how Couche-Tard’s overseas experience could guide its domestic strategy.

Analyst research and The Logic’s interviews with observers of the company indicate that Couche-Tard is tackling two main challenges with its Norwegian stations: attracting customers, and building a system that can turn those customers into profit.

Teitelbaum said her pit stops on her three-hour drives from Oslo to her Norwegian cottage are markedly more pleasant than those she makes in Canadian gas stations. Back in Ottawa, she mostly charges her Tesla at home. If she fuels up elsewhere in Canada, she’s likely spending the charging time—which at public stations can take more than half an hour—watching Netflix in her car.

“There’s not a lot of infrastructure, and it is stopping me from taking some of the trips that I’d like to,” she said. “Everyone keeps saying, ‘Well, what if your battery dies in the middle of a trip?’ I would love to know that, sort of like CAA, I could call Couche-Tard … and they would come and juice me up. That would buy loyalty. But mostly, I want them to build service stations where you feel safe.”

Norwegian fuelling stations of all brands make an effort to get their customers out of their cars. They tend to have cleaner washrooms than their North American counterparts, and fresher food—they are generally regarded as being on par with grocery stores. 

Fresh food has been a strong seller for Couche-Tard’s locations worldwide during the pandemic, according to its most recent quarterly report, and it’s an area in which the company is investing further. In Norway, Circle K is also adding other amenities to new stations, like playgrounds, and seating areas for 50 people or more, complete with wingback chairs and potted plants. 

The company is installing more fast chargers in Europe and expanding a Norwegian pilot of payment via app. Counterintuitively, both efforts are intended to let drivers spend less time at Circle K locations. But increasingly, it’s not just competing for the mantle of “convenience” with other gas stations, but with delivery apps and home-energy providers that allow customers to get the same services without pulling out of the driveway.

“Competition is quite fierce,” said Anders Hovde, a Norway-based auto analyst with Kantar, in an interview with The Logic. “[Convenience station brands are] fairly aggressive in the media in terms of advertisement.”

Norway may be ahead of other countries in converting to EV infrastructure, but even there, EV drivers face challenges like lack of cover from inclement weather and batteries that lose range in cold weather. 

Popular Norway-based EV vlogger Bjørn Nyland frequently documents stops at Circle K and other stations, and at one stop last month counted a queue of nine cars waiting for fast chargers. Teitelbaum said that among her friends in Norway, Circle K stations are considered easier to find and have fairly reliable self-branded chargers, but the app isn’t great at telling if the chargers at a station are available.

“The main issue that we’re trying to solve in Norway right now is how to handle the peaks in rural areas,” said Hovde of the mountains dividing Norway’s transit and electrical infrastructure. Hovde said the country is also politically divided between those who want to move further toward electric vehicles and those who don’t. 

“The oil industry has given us so much wealth. It’s a big part of who we are.” 

These challenges point to the second big issue facing Couche-Tard’s electric ambitions: how to build a profitable North American business around electric charging instead of gas. It’s a challenge bigger than any one company. In Canada, where the terrain is more vast, the Ford F-Series is the best-selling vehicle and GDP per capita last year was about US$24,000 less than in Norway, the Liberal government had committed hundreds of millions to charging infrastructure, prior to Monday’s election. There will potentially still be a lot of spending needed. An April standing committee report to the House of Commons noted that while Canada has about 12,000 gas stations, it had just 290 charging stations per one million residents in 2019; Norway had 1,700 charging stations per million residents. 

Norwegian company Hexagon is one transportation company that’s betting on Canada as a future hub for zero-emission vehicles. It announced a new plant in Kelowna, B.C., last month, and is working on trucks with Vancouver-based Ballard Power Systems. Morten Holum, CEO of Hexagon Purus in Oslo, said in an interview with The Logic that Canada could learn from perks that helped Norway’s transition, like waiving taxes, letting EV drivers use HOV lanes, and waiving fees for ferries, toll roads and parking. 

But will all this pay off enough to supplement declines at the gas pump for Couche-Tard?

Right now, Couche-Tard sells Circle K-branded fuel in many of its stations, rather than pairing its convenience stores with a separate fuel vendor like Shell or Esso. It’s been lauded as a way to save the company money on branding fees, by letting major U.S. refineries bid to provide it with wholesale fuel. Couche-Tard is apparently considering a similar in-sourcing approach to chargers in Norway, according to Hans-Olav Høidahl, Couche-Tard’s executive vice-president of European operations, who said in July that 363 charging stations owned by partners like Tesla there “can or will” be insourced when the contracts end next year. Still, one executive told a trade publication last year that the company didn’t yet know consumers’ price sensitivity to charging, with electricity costs varying by region.

“We think it is going to be profitable, but how much—that’s difficult to tell,” Circle K Norway executive Håkon Stiksrud told online publication PetrolPlaza.

Couche-Tard also hopes to soon sell at-home vehicle chargers in North America, replicating its Scandinavian business model. The company said between 55 per cent to 75 per cent of EV charging in Norway happens at home, with another 20 per cent to 35 per cent being at destinations like shopping centres and offices. In turn, Circle K has also sold chargers to at least 1,500 businesses, and in an earnings call at the start of the month said it now owns and operates EV charging stations at a Norwegian hotel chain, its first “destination charging installation.”  The company has also had an “EV lab” in Norway for more than three years, and executives have previously suggested potential alternate business models like parcel depots.

Back in Canada, Chevy Bolt owner Ian Tamblyn, for one, would like to see some more Norwegian sensibility. A deal with a hotel chain, like the one Circle K has in Norway, would benefit the cross-country touring musician.

The Ottawa dweller has been disappointed to find that many of the charging options advertised to him in Canada, like GM dealerships, have never materialized, with the exception of Canadian Tire.  

But for his next tour, Couche-Tard’s good old gas stations should be safe: unable to find enough charging stations to get out of the Ottawa Valley, he’s back to using his old Toyota Corolla.