Recent advancements in electric vehicle technology have kindled new interest among fleet managers in electrifying their operations, delivery, and broader logistics footprint. But the transition is complex, and capturing all of its upsides requires a proactive strategy.
Any road map to EV fleet adoption should reflect an understanding of total cost of ownership, charging infrastructure, regulatory incentives, and other elements of the EV landscape. With the right strategy, electrification can supercharge growth for fleet managers and pave the road to a more efficient, cost-effective future.
Here’s what those managers need.
See the bigger picture of TCO
When evaluating EV integration, the initial sticker shock of EVs can stop decision-makers in their tracks.
While upfront costs may appear higher than those of a traditional internal combustion engine vehicle, it’s critical to take a broader view of EV cost profiles. A fleet manager must break down the real maintenance and energy costs over time to see the full picture.
Start with operational savings. With far fewer moving parts compared to gas or diesel engines, electric drivetrains require lower maintenance costs over time. Avoiding pricey oil changes, exhaust system repairs, or transmission overhauls means less mechanical downtime and fewer surprise repair charges.
Additionally, many commercial EVs now monitor their own battery health and maintenance requirements, helping to extend battery life and reduce overall costs. And the proliferation of EVs at national dealerships means that vehicle maintenance is becoming increasingly convenient.
Electricity pricing is another intuitive advantage. In contrast with volatile fuel costs, electricity prices are typically more stable, and some fleet managers have negotiated competitive rates with utility providers. Furthermore, smart charging systems recharge vehicles during the grid’s off-peak hours, reducing energy expenses.
As renewable energies contribute more to the grid, those environmental and financial benefits will continue to grow.
An example of TCO savings is Native Poppy, a San Diego-based flower shop, which was able to slash its delivery rates from $30 down to $10-$20 with the savings obtained within months of electrifying its fleet with the Mullen ONE EV cargo van.
Maximize government regulations and incentives
Fleet managers also need to make the most of the deluge of new government regulations and incentives. Aiming to reduce emissions and achieve climate goals, federal and state governments are offering incentives that can translate to tens of thousands of dollars saved per vehicle—if fleet managers know where to look.
These tax credit, grant, and rebate programs reduce the upfront costs of EVs. A federal tax credit currently offsets up to $7,500 per vehicle. Meanwhile, many states and local jurisdictions have rolled out additional grant programs to subsidize EV purchases and the installation of charging infrastructure.
For example, the California Air Resources Board offers up to $240,000 for EV purchases, and Massachusetts launched an EV rebate program that provides up to $90,000 in incentives.
To capture these incentives, fleet managers should collaborate with their financial and legal teams to evaluate their eligibility requirements and application processes. A watertight compliance strategy also helps preempt evolving regulations, particularly those around emissions and fleet composition.
See also: Bollinger Motors celebrates the start of production
Look ahead in a developing resale market
Uncertainty surrounding the resale value of EVs has risen as a concern among fleet managers. It’s understandable; EVs are a relatively new market, and changes to battery life, consumer adoption, and technology can impact future value.
But the resale market for EVs is maturing, and each passing quarter means less and less for fleet managers to worry about.
Current trends suggest demand for used EVs will continue to grow, particularly as battery replacement costs become more predictable and second-life applications and innovations (like energy storage) expand.
For fleet managers, regularly monitoring the car’s performance and battery health—tracking vehicle condition just as one would an ICE vehicle—will maximize resale value.
Surmount charging infrastructure with time
Charging infrastructure is a key concern for fleet managers, who are especially focused on minimizing vehicle downtime and optimizing efficiency at scale.
A well-designed fleet charging strategy will assess current depot capacity for on-site charging, weigh charging speed options (Level 2 vs. DC fast chargers), and evaluate future charging needs. On-site charging stations can significantly reduce downtime, and for larger fleets, investing in smart-schedule, off-peak charging systems can slash costs and balance energy demand.
Plan for range
Range anxiety remains a common concern, particularly for fleets crossing long distances.
However, proactive route planning and new solutions like mobile EV chargers can circumvent this issue. By analyzing vehicle telematics data, fleet managers can map EV routes that optimize the vehicle’s range given charging station locations and availability.
Battery technology innovations have dramatically expanded EV range, but contingency plans for emergency charging are still prudent for commercial fleets.
Developing predictable, repeatable routes to fall back on will reduce the variability in energy consumption, providing more accurate predictions for range and battery performance over time. Optimizing logistics and considering vehicle-to-grid integration will help cool range anxiety and shine light on the many EV-related opportunities.
For example, Mullen recently began road testing its solid-state polymer batteries, which would nearly double the range of Class 1 EVs. More battery innovation will even further ease that range anxiety.
A road map to electrification
The transition to an electric fleet demands a comprehensive strategy that considers cost, regulation, infrastructure, and operations.
By approaching EV integration with a focus on long-term savings through TCO, maximizing incentives, understanding the evolving resale market, and planning for infrastructure and range, fleet managers can navigate the complexities of electrification with confidence.
As government policies continue to incentivize zero-emission fleets, now is the time to act and position your operations for a sustainable future. The opportunities are there. Will you take them?
