Fleet Operators are anxious to take advantage of the benefits electric vehicles promise in their operations. CAF spoke with fleet management experts Foss National Leasing about the factors that need to be considered when plugging in.
It’s almost impossible to be online today without seeing news about electric vehicles. For businesses who rely on fleets as part of operations, many are wondering if and how to begin adopting EVs.
Of course, the answer depends on your individual fleet, the type of business you run, where your fleet operates, and other factors. But the future is clear: zero-emissions vehicles will have a key role to play in your fleet’s operations before long.
In this article, we’ll discuss some factors to consider when deciding how to adopt EVs into your fleet.
Will electric vehicles work for all fleets?
It’s important to keep in mind that today’s EVs are designed for consumers, but commercial fleets obviously have different vehicle requirements from the average consumer.
Fleets often need fit for purpose vehicles capable of carrying equipment and travelling beyond city limits. Right now, there aren’t many EVs on the market that fit those purposes.
The good news is, that will radically change over the next few years, and there are some exciting developments in the works. GM, Ford, and Rivian are all currently working on designing EV vans, pickups, and light trucks. The Ford and GM models won’t be released for a couple more years, but the Rivian work pickup trucks will start appearing at the end of 2021.
Ultimately gas and diesel (ICE) vehicles will continue to play a key role in work fleets for the next three to four years, until electric vans and pickups see wider adoption. However, for those fleets operating within cities—such as sales fleets—today’s EVs likely have the capabilities to allow your drivers to meet their travel commitments. In Canada, most EVs travel 200-400 kilometres on a single charge—enough for a day’s travel within city limits.
What to know about EV costs
Though electric vehicles have been on the road for several years now, it’s still too early to predict the total cost of ownership for an EV’s entire lifecycle, since the industry hasn’t gathered enough data yet. However, data is gradually appearing for EV passenger vehicles, and the initial findings indicate they will be on the road longer and have less mechanical issues when compared to their ICE equivalents.
For work EVs, it will take years to gather trustworthy data, and when it does appear, it will be regional. Vehicle reliability and TCO will be influenced by driving habits and weather conditions.
That being said, here’s a breakdown of some key cost factors:
- Purchase costs of EVs are higher even with rebates. (The Plug N Drive website details the EV incentives currently available at the Federal level, and the provincial levels in BC, Ontario, and Quebec.)
- Electricity rates for charging are lower than the cost of fuel on a per kilometer basis.
- Maintenance costs are far lower with EVs due to the simplicity of the electric drivetrain. (But keep in mind that if something goes wrong with the battery, the replacement costs may be significant.)
- EVs have a longer vehicle life. Some have longer warranties of eight years or 160,000 kilometres on electrical components, and some leasing companies are offering longer lease periods.
- Resale value is critical to life cycle cost calculations, and is currently unknown for the EV market.
Charging considerations to keep in mind
Access to EV charging stations is improving:
- As of February 2021, there were 13,230 EV chargers at 6,016 public stations across Canada.
- 2,264 of those public chargers are DC fast chargers which can fully charge an EV in under an hour.
- The federal government has also promised to spend $130 million building EV charging (level 2 or higher) and hydrogen refueling stations across Canada until 2024.
If your vehicles return to the office every night (and provided the electric grid can handle the increased load), you’ll also need to install workplace charging stations. For those businesses whose vehicles return home with the employees, there are some additional issues to consider, such as: Who pays for the employee’s home charger and increased electricity use? What happens if the employee leaves the company? And others.
None of these issues will necessarily be major roadblocks, but they could present challenges that need to be taken into account.
Our advice: Consider a gradual transition
If there’s one thing that we at Foss National Leasing have learned, it’s that every fleet is different and there’s no one-size-fits-all solution for vehicle selection or use. So we recommend trying a gradual approach when adopting EVs, so you can find out for yourself if they’re a good fit.
Before anything, consider how you’ll install the required charging stations, whether at your workplace or the employee’s home, and ensure the electrical grid can handle the increased load. Having this foundation in place will ensure things will run smoothly after you bring the vehicles on board.
Then, try a few vehicles first, so you can track their reliability and TCO in your unique conditions. Consider a shorter lease term so you’re not committed to a specific model or brand for a long time.
Finally, work with a fleet partner like Foss National Leasing for strategic guidance on adopting electric vehicles, charging considerations, acquiring the right vehicles for your needs, and more.