Electric Truck Fleets to Accelerate in 2021 and Beyond

November 23, 2020 by Trucks.com, @trucksdotcom

Editor’s note: Written by David Peterson, director of fleet solutions, ChargePoint. This is one in a series of periodic guest columns by industry thought leaders.

There’s no doubt that 2020 has been a challenging year for businesses. But, just as many companies have scaled back operations and investments to weather the COVID-19 pandemic, fleets are having the opposite problem.

Delivery fleets in particular have scrambled to keep up with increased demand from online shopping. Sales made online are up nearly a third from 2019 levels and is projected to top a staggering $794.5 billion by year’s end. Government fleets continue to grow as well, spending dollars already earmarked for projects that were greenlighted prior to the downturn. That increased activity combined with a renewed focus on health and the environment has accelerated electric fleet pilots across industries.

If one bright spot has emerged during the current crisis, it’s that we’ve all seen “with shocking speed” that reducing air and noise pollution is not only possible, it’s within reach. When lockdowns began last spring, greenhouse gas (GHG) and other noxious emissions dropped precipitously. According to Bloomberg, 2.6B metric tons of CO2, or 8 percent of the annual total, will never be emitted into the atmosphere. That’s good news. The bad news is that it’s still not enough to meet Paris climate targets, which with a change in administrations the U.S. is likely to rejoin.

With the transportation sector contributing nearly a third of the GHG emissions in the U.S., fleets are under increased pressure to do their part to, as the United Nations puts it, “build back better.” Fortunately for fleet managers, the benefits of electric vehicles extend well beyond the environmental.

Many large delivery fleets were already moving forward with electric fleet pilots prior to the pandemic. Last year, Amazon ordered 100,000 delivery vans from EV startup Rivian.

The company hopes to inspire others to “think bigger,” according to Ross Rachey, Amazon’s Director of Global Fleet and Product Logistics. At this year’s VERGE 20 clean economy conference, Rachey noted the importance of large companies setting an example.

“We’re at the point now where we’re really comfortable placing big, bold bets. We’re comfortable being a first mover,” he said.

Both UPS and FedEx are betting big on electric as well. At the same conference, FedEx’s Managing Director of Express, noted that his company has the ability to go electric with “the vast majority” of its worldwide fleet today. “We’re going to buy those vehicles for billions of dollars anyway, and [EVs are] so close to [cost] parity that it doesn’t make sense to wait anymore,” he said, adding that, because EVs last longer and have lower fuel and maintenance costs, the total cost of ownership is a winner for fleets.

One obstacle to electrification fleet managers have cited is a lack of available vehicles for their individual use cases. As the larger fleets continue to scale their operations, availability is becoming less of an issue—especially in the light and medium-duty truck sectors. When it comes to driving the adoption of electric vehicles, we know that consumer choice plays a major role. With pickup trucks making up a large portion of commercial and consumer demand, it seems like a no brainer to offer more electric pickup options. Pickup trucks so far this year have accounted for one out of every five new light-vehicle sales, according to data compiled by Trucks.com.

David Peterson

David Peterson

In the coming years, we will see much-anticipated offerings from electric-only manufacturers Rivian and Tesla, as well as traditional automakers such as GM, which is bringing an electric version of its popular Hummer to market next year. For its part, mainstay Ford is expected to release an electric version of its popular F-150 sometime in 2022. That’s following the release of the company’s E-Transit cargo van, which will hit the streets next year. With a starting price under $45,000, it’s a compelling offering for those all-important last-mile deliveries.

As the demand for electric options grows— especially for medium- and heavy-duty vehicles—vehicle manufacturers will continue to ramp up the development and production of their offerings, expanding further into semi-trucks and transit buses. In fact, California and New York City are on track to achieve goals of 100% zero-emission bus fleets by 2040. Earlier this year, the NYC Metropolitan Transportation Authority (MTA) pilot deployed five 60-foot-long articulated e-buses. It plans to add another 500 electric buses to its routes by 2024, on its way to total electrification by 2040. Green mandates, such as California’s recent announcement requiring all passenger cars and trucks sold after 2035 to be zero-emission will further the inevitability of electric vehicles in the coming years.

With the electric fleet market share predicted to reach 47 percent by 2040, access to EV charging must keep pace. Fortunately, that’s exactly what’s happening. The worldwide electric vehicle charging infrastructure market is expected to be worth $56.9 billion by 2026, according to a recent Polaris Market Research report. In both North America and Europe, roaming partnerships have increased both range and access, while reducing friction for drivers. Combined with the increasing availability of fast chargers on highways, better battery technology and falling costs there’s never been a better time for fleets to begin their electric pilots.

Throughout the year, both businesses and workers have shown resilience in the face of adversity. If we’ve learned anything from 2020, it’s that massive change can happen overnight and that we can adapt just as quickly. As we begin to create a new normal, we can decide what kind of world it is that we want to live in. One thing is certain though—EVs will be part of it and, as is so often the case, fleets will lead.

Trucks.com welcomes divergent thoughts and opinions on transport technology and trucking industry issues. Use the comments section to cite yours. Qualified opinion leaders are welcome to offer suggestions for opinion columns. Contact info@trucks.com.

 

Jerry Hirsch November 2, 2020
Volvo Group and Daimler Trucks created a joint venture that will develop, build and commercial hydrogen fuel cell systems for heavy-duty trucks.

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