Swapping out the world’s fleets of fossil fuel-powered trucks, buses and cars for electric ones can be a timely, expensive and sometimes painful task for the companies and organizations looking to electrify their vehicles. But paying close attention to lessons learned and tips from fleet leaders who have already gone through the process can help reduce challenges.
At the VERGE 22 conference in San Jose, California, last week, fleet managers and service providers to fleets talked about what they’ve learned along the way. It’s still a relatively early time in the electric fleet transition, both in the U.S. and globally — according to Bloomberg New Energy Finance, only 1 percent of the world’s new vans and trucks sold in 2021 were electric.
“Your electrification journey will be one of the more complex endeavors you’ve ever done,” said Bill Cawein, global technology and integration manager, FedEx Express.
But some companies are trying to move aggressively, pushed by a combination of state and federal incentives and mandates, dropping costs and growing options of EVs, and bold sustainability commitments. Companies such as Amazon, FedEx, IKEA, Walmart and Genentech have made plans to electrify large portions, or all, of their fleet vehicles.
At VERGE, fleet chiefs of FedEx, Lyft, Keurig Dr. Pepper, Walmart, Genentech and others shared how they started, where they are in their electric journey and what they’ve learned along the way. For several fleet managers, they described talking about the difficult transition as “therapy,” and a way to help others avoid the mistakes they’ve made.
Here are 10 lessons that fleet leaders have learned and shared at VERGE 22 (for other learnings, check out this GreenBiz report on electrifying global delivery and logistics fleets):
1. Expect long lead times for everything: It could take as much as two to three years to line up all the vehicles, charging gear, grid infrastructure and financing, among other details, for fleet electrification projects. If the local utility needs to add a new service connection for the charging site, that’s on average a 12- to 24-month project on its own.
FedEx’s Cawein said the shipping company is on a “3-year planning cycle” for its electric fleets. “The supply chain has the biggest impact … the lead times are incredible,” said Cawein.
FedEx uses over 180,000 vehicles to deliver packages across continents and has a goal to move its entire package pickup and delivery fleet (mostly medium-duty vehicles) to zero emission by 2040. The company says that by 2025, half of FedEx Express’ new package and delivery fleet purchases will be of zero emission vehicles. By 2030, 100 percent of those new purchases will be zero emission vehicles.
2. Just start — and now: Because the transition could take several years for both small and large fleets, the fleet leaders all agreed, the time to start the process is today. “Begin now,” said Nicole Efron, director of development for NextEra Mobility, which provides services to companies to manage the electric fleet transition. Efron said some of the biggest delays come from long approval cycles and bottlenecks in the supply chain for vehicles, as well as grid gear such as extra transformers and utility equipment. “Service connection timelines can drive your project schedule,” noted Efron.
Walmart’s vice president of energy transformation, Chelle Izzi, said there’s another reason for urgency: competition for resources. “We’re all going to file interconnection applications at the same time. I don’t want to be at the end of that line. We need to start now.”
Two years ago Walmart announced that it will electrify and zero out emissions from all Walmart vehicles, including long-haul trucks, by 2040. That includes more than 10,000 vehicles, including 6,500 semi-trucks and 4,000 passenger vehicles.
Don’t let the perfect be the enemy of the good and “just start,” said Lyft’s head of sustainability, Paul Augustine. Beginning the electric fleet transition may be a daunting task, but delaying the transition will be even harder in the long run. Lyft plans to electrify every car on its platform — those owned by Lyft, those rented to drivers, and those owned by drivers — by 2030.
Your electrification journey will be one of the more complex endeavors you’ve ever done.
3. Listen to drivers: While fleet managers are leading the charge for buying corporate electric trucks and cars, companies’ drivers will need to be the on-the-ground champions of the vehicles and could make or break an EV fleet project.
“Engage drivers early and often to ensure that their voices are heard,” said Margaret McCall, principal data scientist for NextEra Mobility. Companies can engage drivers through surveys and ride-and-drives and should hold quarterly feedback reviews to keep the information flowing, said McCall.
Lyft’s Augustine said one of his three most important lessons learned during his time at Lyft is “listen to the driver.” He heard from drivers that had adopted EVs early on Lyft’s platform crucial info, that they didn’t feel safe charging at some sites (for instance, an abandoned lot at night), or that charging vehicles took too long using certain chargers.
For Genentech, the key to helping get more of its sales employees into electric cars — which oftentimes they take home overnight — was getting drivers home chargers and making sure they were getting EVs that they were excited about, said Genentech Senior Director of Transportation Andy Jefferson.
4. Collaboration and communication across teams: Companies must encourage collaboration not just among fleet leaders but across teams, including buildings, site planning, energy, financing, budget, taxes and sustainability.
The fleet leaders at VERGE 22 shared stories about the fleet team receiving deliveries of EVs that had to wait months for the charging infrastructure to be installed, and vice versa — chargers that had been installed for months gathering dust as the electric truck deliveries were on a different timetable. Better coordination across teams can help streamline all the moving parts.
5. Pilots need purpose: It’s great to do a pilot project to test out the viability of a certain type of electric truck to meet the demands of companies’ needs, but pilots need to be designed to achieve a specific goal, pointed out NextEra Mobility’s McCall. McCall said pilots need to “be the first step in a broader plan.”
Many companies that have already made aggressive EV fleet commitments are already past the piloting phase, such as FedEx, Amazon and Genentech. Other companies that have yet to make major commitments will be designing and running pilots over the next couple of years.
6. Educate on incentives: This year there are more funding sources available than ever before for electrifying fleets. California has its HVIP program (Hybrid and Zero Emission Truck and Bus Voucher Incentive Project), which provides funds to organizations for electric trucks and buses. Texas, too, has had ample funding for its clean fleets program.
The Biden administration has pledged billions of dollars for charging projects, and electric transit and bus programs through the Inflation Reduction Act. Some utilities also offer grants through “make-ready programs” that support electric fleet charging sites.
Knowing what incentives are available and the various timelines to apply for the funding can be a complicated task. Some programs also become full very quickly. Fleet leaders need to be well-versed and educated on the latest incentive options and how to apply for them.
Engage drivers early and often to ensure that their voices are heard.
7. Vet your vendors: Because the electric truck sector is so new, many startups have done deals with large fleets, and then ultimately failed to deliver on vehicles, chargers or software systems. As the industry matures, more large global companies will become more aggressive and move more swiftly into the fleet space.
“There are a lot of suppliers out there … be selective,” warned FedEx’s Cawein. Cawein said he will only work with global universal standards for his fleet and charging gear, and the products he orders need to be able to scale up to meet FedEx’s needs. “Failure is not an option,” said Cawein.
8. Future-proof: Some fleet leaders noted that they made decisions early on in their journey — like buying a certain type of proprietary charger or designing a site with a limited amount of energy capacity — that years later couldn’t scale for a larger fleet. Some had to rip out old gear and cables, or build new sites in an inefficient way.
Companies need to design their electric fleet programs with some kind of big picture North Star, like an overarching sustainability goal. Higher level goals can help companies plan for the short, medium and long term, and help avoid costly and time-consuming mistakes.
NextEra Mobility’s Efron said, for example, if a company is installing just 10 chargers today, it’s a smarter bet to use electrical cabling that can accommodate 50 chargers down the road: “If you do it upfront, it will save you money overall in the long run.”
Walmart’s Izzi said the company is using its 2040 net-zero goal as its North Star, and is working backward from there for its fleet design.
9. Map out unique design requirements: Companies’ fleet needs can be incredibly diverse. The vehicles they might use span from the smallest cars to the largest semitrucks to motorcoaches. Likewise, the vehicles can be used for various applications from delivering packages in a dense urban city to moving a container at a port to transporting young tech workers to offices.
The important thing to remember is that designing and building a charging site to manage and fuel up the fleet vehicles will be highly dependent on how the vehicles will be used, maintained and energized. Site design plans need all stakeholders involved to make sure that drivers and technicians are able to run their operations without problems.
Walmart’s Izzi said that she recently learned that her company prides itself on rerouting some of its trucks to provide aid during disaster events such as Hurricane Ian. Izzi said she realized she had to incorporate that goal into the overall electric fleet plan.
10. Enjoy the journey: With such a long, difficult and expensive journey ahead, Lyft’s Augustine emphasized that the industry needs to celebrate wins and recognize the importance of the transition.
“We’re at this point where there is nothing but tail winds. It’s going to be hard, but enjoy the journey because we’re starting this revolution to a fully electrified transportation system,” said Augustine.