Delivery Fleets Love Electric Trucks

Frito, FedEx, Coke, and others don’t suffer from range anxiety, and like the lower fuel costs and better image.

Even as auto manufacturers seek to convince car buyers of the virtues of electric vehicles, one key group needs little persuasion: delivery fleet managers. While commuters and vacationers may fret about so-called range anxiety—the fear of not making it to a charging station before the car’s battery needs topping up—drivers of commercial delivery vehicles tend to follow the same route each day, so they have a pretty good idea how much power they’ll need. And since trucks typically return to the garage every night, there’s little worry about finding a charger. Electrics “are quiet, don’t pollute, and vibrate less than diesels,” says Mike O’Connell, director of fleet capability for Frito-Lay North America. “Our sales reps are fighting over who gets the next one.”

Frito-Lay has bought 176 electric delivery trucks for use across the country, or about 1 percent of its total fleet. As that number grows, O’Connell says, the vehicles will be instrumental in reaching a company goal to halve fuel use by 2020. The trucks, all of them a model called the Newton from Smith Electric Vehicles of Kansas City, Mo., have cut fuel expenses and boosted worker productivity, says Bob Simpson, Frito-Lay’s fleet manager for the New York region. By May, 6 percent of Simpson’s fleet of 250 trucks will be electrics, and if he had his way he would replace all of his diesels with them. They offer “real savings [on fuel], and we expect even more when you factor in very low maintenance and repairs,” Simpson says as he threads his way through greasy diesels to show off his Newtons on a Brooklyn lot.

Less than 1 percent of the 135,000 medium-duty trucks that U.S. companies will buy this year will be electric, according to Americas Commercial Transportation Research. But battery prices, which represent about a third of the cost of an electric truck, will likely fall to a quarter of today’s level by 2020, which will “drive down costs and create demand,” says Glen Walker, an analyst at Bloomberg New Energy Finance. Until then, incentives will likely help sales, he says. The federal government offers a tax credit of up to $7,500 for each electric vehicle, and California and other states offer additional rebates of as much as $5,000.

Ford Motor and Azure Dynamics, a Canadian company, in December introduced the electric Transit Connect van. Ford aims to manufacture more than 750 of them this year, vs. 30,000 gasoline-powered models of the same truck. With a range of about 80 miles, the vans cost $57,400, or nearly triple what the gasoline version costs. Navistar has built 78 of its $150,000 eStar electric trucks. While the eStars are roughly double the price of similar diesels, Navistar aims to sell some 700 electrics by mid-2012. FedEx has bought 19 eStars for use in cities worldwide, though the company says it needs to study their performance before committing to a large order.

Smith hopes to sell about 1,000 Newtons this year, five times what it did in 2010. The $100,000 trucks, with a range of up to 100 miles, are built on a chassis purchased from a Czech manufacturer, and their electric components come from American subcontractors. Coca-Cola Bottling, AT&T, and utility PG&E have all replaced diesels with Newtons, and in December the U.S. Marine Corps ordered two for its base in Camp Pendleton, Calif. While the trucks cost 50 percent more than diesel-powered rivals, Smith Chief Executive Officer Bryan Hansel says buyers will make up for that premium with lower fuel costs and a better image. “Our customers see it as a marketing advantage,” he says.

Office supply retailer Staples says the benefits are clear. The company has 41 Newtons—about 3 percent of its total delivery fleet—in California, Missouri, and Ohio. Staples is considering an order for more this fall as leases expire on 140 diesels. The company says the Newtons have helped it cut fuel use by 4 percent in the past three months. Passersby often stop drivers to ask about the trucks, says Staples fleet manager Mike Payette. “It’s pretty cool for [drivers] to be able to say they didn’t use any gas today,” he says.

Some buyers, though, say there’s still some reason for range anxiety. During a December storm that dropped 20 inches of snow on New York, one Frito-Lay driver got stuck midway through his route and almost drained the Newton’s battery rocking the vehicle back and forth to gain traction. He returned to the garage and had to complete his rounds with a diesel, says fleet manager Simpson. Nonetheless, the driver wouldn’t hear of switching back permanently. “He said, ‘No way,'” Simpson says. “I’d take a beating if I tried to take one of these away from my drivers.”

The bottom line: Companies are starting to use more electric trucks, which they say are ideally suited for urban deliveries.

Christopher Martin