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PHOTO CAPTION: FritoLay uses Smith Electric Truck.

Making Electric Vehicles Pay

MIT Technology Review examines commercial fleets now introducing electric cars and trucks into their operations.

Published: 18-Jan-2011

Commercial fleets are a logical place to introduce battery-powered electric vehicles. After all, fleet vehicles operate with relatively predictable driving patterns, return to a central location overnight, and are managed by sophisticated logistics professionals who can weigh the cars' lower fueling and maintenance costs against their premium purchase price. Last year, managers of large fleets began exploring in earnest what EVs offer, kicking off demonstrations that will come to scale this year.

Companies such as FedEx, PepsiCo (through its Frito-Lay business), and AT&T are each deploying tens to hundreds of electric delivery vans from manufacturers such as Navistar, Smith Electric, and Azure Dynamics. And in November General Electric announced an aggressive plan to make EVs account for half of its 30,000-vehicle fleet by 2015 and to lease another 10,000 EVs to other commercial fleets managed by GE Capital.

Motivations vary. Going electric confers an image of corporate responsibility on these early entrants, and for GE it also primes the market for wares such as GE-designed charging stations. But Oliver Hazimeh, director of the automotive practice for the Boston-based management consultancy PRTM and principal author of a November 2010 report on fleet electrification, sees more than a marketing play. Hazimeh says the early adopters anticipate an inevitable shift to electric transportation and are learning through doing: "They're all looking at the fundamental drivers and saying oil prices are not going to be cheaper and less volatile, emissions regulations are going in one direction, so for the longer term we have to start turning our fleet toward this technology."

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