Electric Delivery Fleets

Thursday, December 23rd, 2010

Electric vehicles may or may not make solid economic sense for many consumers, but they have their advantages in commercial delivery fleets:

Staples has ordered 41 trucks from Smith Electric Vehicles of Kansas City, Mo., and will start receiving them in January. There is “a real strong chance we’ll make a second order for 40,” Mr. Payette said.

The trucks, which have a top speed of about 50 mph and can carry 16,000 pounds, cost about $30,000 more than a diesel, but Staples expects to recover that expense in 3.3 years because of the savings inherent in the electric models, Mr. Payette said.

Staples said the annual maintenance cost of a diesel delivery truck is about $2,700 in most years, including oil, transmission fluid, filters and belts. For an electric truck — which has no transmission and needs no fluids, filters or belts — the cost is about $250.

And since it costs much more to maintain an internal-combustion delivery truck than a car, the cost savings for truck fleets is greater than for consumers buying an electric model.

One big savings comes in brakes. Because electric trucks use “regenerative” braking, which returns some of the force of stopping to the batteries in the form of electricity, the brakes don’t wear out as fast. That means the brakes last four or five years, not one or two, before they need a $1,100 repair.

Electric trucks also don’t need the urea exhaust-cleaning system of diesels, which costs about $700 a year to maintain. And electric motors are far less complex than diesel engines, last much longer and the training required to work on them is minimal, Mr. Payette said.

On top of this, Staples says it will save each year roughly $6,500 in fuel costs per electric vehicle over a diesel model.

Each of Staples’s electric delivery trucks will run a daily route of under 70 miles and then come back to be recharged at night. In addition, since its nonelectric trucks get about 10 miles per gallon, the savings in fuel costs with an electric is more dramatic that it is for consumers buying an electric car.

On the flip side, electric trucks cost substantially more. A Smith model with a 50-mile battery range and basic equipment would go for about $90,000, compared with about $60,000 for a diesel model, Smith Electric said. Mr. Payette declined to say what Staples is paying for models with a 100-mile range.

Add it all up and Staples expects to save nearly $60,000 over the 10-year life of an electric truck over a diesel model.

One impediment to wider adoption of electric trucks: few finance companies offer leases on them. That’s because finance companies are unsure about how to value the lease “residual,” a truck’s worth after a few years of use. Many large companies, including Staples, prefer to lease trucks to avoid the large capital requirements of an outright purchase, Mr. Payette said.

Still, some big truck customers are trying out electrics.

FedEx is using 19 all-electric vehicles in London, Paris and Los Angeles made by Modec of Great Britain and Navistar International Corp. FedEx Chief Executive Officer Fred Smith has been outspoken about his desire to see electric vehicles proliferate, in part to cut the U.S. dependence on imported oil.

Frito-Lay, meantime, has ordered 176 Smith electric delivery trucks. The snack foods maker intends to convert up to half of its 4,000 medium-duty trucks to battery-powered models.

“We are not making a trade-off and doing a good deed for the sake of a good deed. There is a great return on that investment,” said Mike O’Connell, director of fleet operations for Frito-Lay.

Mr. O’Connell estimates his company will reduce fuel consumption by 500,000 gallons a year with its first batch of electric trucks.

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