Walmart’s private fleet is not only large, with some 6,400 tractors and 61,000 trailers, but it’s also a near-perfect reflection of the giant corporation’s goals and commitment to social responsibility. And it’s come to represent perhaps the most publicly visible strides the company has made as it pioneers meaningful corporate efforts to foster sustainability.
Right after the devastation of Hurricane Katrina in 2005, the company’s corporate leadership began talking about the opportunity it had to leverage Walmart’s size and scale for good. Acting quickly on that initial impulse, the company laid out a long-range sustainability effort with a three-part pledge: the company would re-engineer its entire organization to create zero waste, operate 100% with renewable energy, and sell products that sustain both people and environments.
Those are lofty goals, ones that require contributions from every level of the retail giant’s global employees as well as its suppliers, but the company is well on its way to achieving them. Today, 75% of its global waste is diverted from landfills, 25% of its operations are powered by renewable energy sources, and overall the company has removed some 35 million metric tons of carbon emissions from its supply chain despite its continuing growth over the last 12 years.
The fleet’s initial contributions to those goals have been massive. As its first step back in 2005, the U.S. fleet operation pledged to double its efficiency by 2015. Easy to say, but much harder to achieve while still providing the core transportation functions Walmart depends on to maintain its retail dominance.
“We built a business case around three legs of the stool—equipment, drivers and operational changes,” says Tracy Rosser, senior vice president of transportation. The first leg was filling trailers. While that might sound like simply stuffing more things in trailers, “there are a lot of things upstream like consolidation of orders and making sure freight comes into distribution centers on time so we can get it on the right trailers,” says Elizabeth Fretheim, senior director of logistics sustainability.
“It’s part science, a lot of training and a big team effort from everyone, including our suppliers, but if you get just one more case onboard a trailer, it adds up,” says Rosser.
Along with more cargo on each trailer, Walmart undertook a major reengineering of its routing to cut out unproductive miles. “We invested in optimization technology to route trucks and drivers as efficiently as possible,” says Rosser. “Now we throw out the entire (routing) network every six months and rerun the optimization to make sure we’re running the least amount of miles possible.”
The other two legs of the Walmart stool—drivers and equipment—are closely related. The fleet specs the most fuel-efficient vehicles available, taking advantage of everything from full aerodynamic tractor and trailer packages to optimized powertrains with automated transmissions. Maintenance, too, plays a crucial role in keeping tractors and trailers at maximum efficiency.
But proper spec’ing and maintenance are meaningless without teaching drivers how to best exploit those capabilities. “Trucks have changed so much in terms of engines and other technologies,” says Fretheim. “They have to be driven differently, so we buy the best technology we can and then spend a lot of time with our drivers to help them maximize the efficiencies.”
Rosser, who has over 30 years of experience in trucking, makes it a practice to ride in a randomly chosen truck once every quarter. Recently, he was in a tractor pulling a full load up a steep grade outside Coleman, AL, and it didn’t sound to him like the engine was in the right gear. “I didn’t hear any stress on the engine, and when I questioned the driver, he pointed to his tach,” he recalls. “He knew that his peak utilization was at 1,200 rpm and that he shouldn’t run over that pulling a hill. When we stopped, he showed me his fuel economy log, which he’d kept for every day over the last six months. When our drivers get behind something, they get behind it in a big way.”
With that kind of commitment from everyone involved in Walmart transportation, the fleet met its ambitious goal of doubling freight efficiency by mid-2015, some six months ahead of schedule. The payoff? In fiscal 2016, Walmart’s private fleet delivered one billion more cases and drove 460 million fewer miles compared to 2005. “We reduced our carbon dioxide emissions by 650,000 metric tons, which is the equivalent of removing 140,000 cars from the roads, and saved nearly $1 billion,” says Rosser.
But Walmart hasn’t just been working on freight efficiency; it’s also been prodding technological advances. “We’ve seen incremental improvements [in truck technology] that have been important, but we really wanted to do something more revolutionary to show that there’s still a lot of room for even more,” says Fretheim.
The most intriguing of those efforts was building a prototype tractor-trailer combination in partnership with Peterbilt Motors, Great Dane Trailers and Roush Engineering. Called the Advanced Vehicle Experience, or AVE for short, this complete rethinking of the heavy-duty commercial vehicle featured a hybrid powertrain with a turbine generator, a narrow and highly aerodynamic driver’s pod, fully electrified auxiliary components, and extensive use of carbon fiber in both the tractor and trailer among other advanced technologies.
In addition to AVE, Walmart has invested in a range of advanced projects demonstrating various hybrid assist systems, natural gas and other developing technologies.
But all that’s in the past. What’s next for the Walmart fleet? Last year, Walmart president and CEO Doug McMillon reconfirmed the company’s commitment to sustainability. Signing what are known as the Science-Based Targets set by the 2015 Paris Climate Agreement, he pledged that Walmart would reduce its absolute emissions 18% by 2025 even as it continues to grow its business around the globe.
“He didn’t call out the fleet separately, but as a company we have to look at every lever we can pull to make that reduction, so we’ll be taking a new look at our operations,” says Fretheim. That new look will not only include deeper collaboration with the fleet’s suppliers, but also with other carriers, she says, promising that there will be a major announcement from the fleet later this month.
“Even though Walmart is large, in some areas we need even more demand to show the market there’s support for these technologies. We want to work with other people in the industry to drive market demand for the new technologies that will get us to our goal,” Fretheim says.
And that’s how you leverage size for the common good.
