Passenger cars receive outsized attention when discussing a future free from fossil fuel. And whilst personal vehicles are undeniably an important step toward the mass adoption of electric vehicles (EVs), it will be fleets that ultimately lead the e-mobility revolution. Often unnoticed, fleet vehicles are central to all our lives—especially today. They move the food we eat, the clothes we wear and even the medicines that keep us healthy. Whether it’s a light-duty van delivering consumer goods to people’s doorsteps or a heavy-duty lorry hauling large loads to and from warehouses around the country, it’s safe to say none of us could live without them.
BloombergNEF’s latest Electric Vehicle Outlook report suggests that by 2040 one-third of commercial vehicles worldwide could be electric. That massive shift toward fleet electrification is good news for the health of both people and the planet. Whether it’s cost savings, sustainability goals or adhering to government environmental targets, the motivations for the shift to electric are diverse.
Whilst personal vehicles are undeniably an important step toward the mass adoption of electric vehicles, it will be fleets that ultimately lead the e-mobility revolution
According to BNEF, sales of electric fleet vehicles will more than double this year compared to 2020. Why? There will simply be more models and types of EVs to choose from. Automakers plan to introduce dozens of light- and heavy-duty electric fleet vehicles in 2021. Players include electric-born start-ups like London-based Arrival, Amazon-backed Rivian and EV-leader Tesla, as well as traditional manufacturers including Daimler, Ford and Volvo. More vehicle choice removes what has traditionally been one of the biggest barriers to fleet EV adoption.
Cost savings are a major driver of fleet electrification as well. EV first movers have already experienced savings of between 20% and 25% over traditional internal combustion engine (ICE) vehicles. That’s even before light-duty EVs reach cost parity with traditional vehicles thanks to falling battery prices. How? Reduced fuel and maintenance costs. Electricity is cheaper than either gasoline or diesel. Fleet managers are able to further lower fuel costs by using networked charging to optimise efficiencies. Finally, EVs have far fewer moving parts compared to their ICE counterparts, resulting in significantly lower maintenance costs and a longer working life, reducing the total cost of ownership even more.
Electrification isn’t only good for the planet; it’s also good for business
Big brands are electrifying their fleets
Sustainability commitments are the third main driver of electric fleet adoption, The Climate Group, The Climage Pledge and Ceres’ Corporate Electric Vehicle Alliance have all played a huge role in advancing EV adoption by global fleets. Major brands, including delivery giants Amazon, UPS, FedEx and DPD have all announced plans to electrify in the coming years. In 2019, Amazon announced its intention to purchase 100,000 electric delivery vans from Rivian, with plans to deploy the first 10,000 “as early as 2022.” For its part, DPD plans to offer green delivery to 200 European cities by 2025. Back in 2019 the company promised to convert 10% of its fleet—over 700 vehicles—to electric by this year. It reached its goal in July 2020, five months early.
These are all compelling reasons for fleet electrification, but they’re not the only ones. Companies around the world understand more than anybody that everything is connected. By doing their part to combat climate change, they are realising other benefits as well, including cleaner air, healthier cities and improved quality of life for their customers and employees. In short, electrification isn’t only good for the planet; it’s also good for business.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
André ten Bloemendal is Vice President of Sales in Europe for ChargePoint
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