How Electric Vehicles Reduce The Cost Of Doing Business - Hedge Fund Alpha (formerly ValueWalk Premium)
Electric Vehicles

How Electric Vehicles Reduce The Cost Of Doing Business

According to the Department of Energy, charging an electric car costs about half as much as fueling a gasoline-powered car. The U.S. average per gallon of gasoline is $2.50 while it would cost $1.10 per eGallon to charge an electric car. As a result, electric cars, buses and trucks save money on fuel and maintenance.

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Electric Vehicles

By Kārlis Dambrāns from Latvia (Nissan e-NV200 Evalia electric car) [CC BY 2.0 ], via Wikimedia CommonsBy Kārlis Dambrāns from Latvia (Nissan e-NV200 Evalia electric car) [CC BY 2.0 ], via Wikimedia Commons

Currently, the United Parcel Service operates more than 770 electric or hybrid vehicles and more than 8,500 alternative fuel and advanced technology trucks worldwide. By 2020, UPS aims for one in four of its vehicles to be electric, hybrid or alternative-fuel. By 2022, 1,500 trucks, which is 66 percent of the UPS fleet, will operate on electricity.

One of New York Gov. Andrew Cuomo’s goals is to reduce emissions by 40 percent in 20 years.  A recent public-private partnership between UPS and the New York State Energy Research and Development Authority was announced to support this effort.

Twelve large cities worldwide, including Los Angeles, Mexico City and Seattle, recently pledged to incorporate all-electric buses in public transportation fleets beginning in 2025.

BAE Systems currently provides six different types of more than 8,000 hybrid and electric buses in North America and Europe. Each model produces zero or near-zero emissions, including the nearly 2,000 Series-E hybrid-electric buses operating today.

Other companies that are incorporating EVs include Frito-Lay, FedEx and Coca-Cola. Frito-Lay operates more than 250 EVs worldwide. FedEx introduced Nissan e-NV200 vehicles for pickup and deliveries in the United Kingdom earlier this year. Coca-Cola adopted hybrid electric delivery trucks in New Orleans as early as 2009.

Tesla plans to begin production of its new electric heavy-duty truck in 2019. J.B. Hunt Transport Services and Meijer Inc. are two customers interested in buying them.

In addition, Volkswagen committed $1.7 billion to develop the required technology for electrification of trucks and buses by 2022. The company is focused on shrinking the size and increasing the efficiency of batteries to make electric trucks and buses more appealing.

Cost-effective fleet management options will become more critical as the automotive industry continues to move toward a ride-sharing future. Uber is helping drivers purchase or lease EVs and incentivizing drivers to educate riders about these new cars. This will bring more EVs on the road and increase their public awareness.

Lyft has announced that it will provide at least one billion rides per year using electric autonomous vehicles (AVs) by 2025, all powered by 100 percent renewable energy. AVs are likely to be electric because they are cheaper and easier to maintain than traditional automobiles and EVs are also simpler for computers to drive. Trips would become even more affordable since drivers are not needed.

GM believes that all AVs must be electric and is linking its autonomous driving effort to EVs to compete with Tesla. GM’s goal is to offer an electric and autonomous ridesharing service, similar to the Tesla Network announced last year, and bring the cost of travel per mile to under $1.

Many recognize that electric vehicles benefit the environment, but fewer individuals realize these cars create efficiencies for businesses since they are cheaper to maintain and operate than traditional cars.

Article by Constance Douris, Inside Sources


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