The electric vehicle sector has been gaining prominence over the years. Be it for commercial or personal use, their preference has seen a surge. Increasing fuel costs, low maintenance cost of EVs, government subsidies and tax write-offs, environment friendliness are making electric vehicles an attractive option both in India as well as at global levels.
However, commercial fleets specifically have also been embracing electric vehicles off lately. A study by Research and Markets highlights projects global electric commercial vehicles market to grow from $60.11 billion in 2020 to $63.71 billion by the end of 2021 at a CAGR of six percent. NITI Aayog further points out in its report that by 2030, out of the total EV sales penetration in India, 70 percent would be for commercial fleets. This is indicative that the commercial fleets market will adopt EVs in the times ahead due to their new-age features of energy efficiency and lower emissions levels and affordable pricing.
By installing commercial charging stations for fleets, businesses will benefit majorly. Be it saving fuel, finances, or time, EVs can emerge to be a cost-efficient as well as an environment-friendly solution for the commercial fleet market in various ways –
Cost-Saving On Fuel
One of the major reasons that give EVs an edge over traditional vehicles is that they don’t require engine oil, gasoline, or any kind of fuel to function. The price of oil fluctuates on a daily basis at the global level and this severely impacts the drivers. With EVs, one can bid goodbye to the volatile global crude oil prices! By running on electricity, the average cost of an EV running on electricity is equivalent to $1 per gallon of gas.
As per a joint study by The Climate Group and Climate Trends, the fuel cost of running an ICE vehicle turns out to be INR 3.6-5.6/km. Whereas for EVs, the cost of running comes down to INR 1/km drive. Hence, switching to the electric fleet and installing charging stations for your commercial fleets can help you save fuel costs significantly.
Cost-Efficient On Maintenance
EVs render another major advantage of low maintenance over Internal Combustion Engine vehicles. While repairing the latter can burn a hole in the pocket, EVs can be a major cost efficacious solution for commercial fleets.
As per the same report by The Climate Group and Climate Trends, maintenance costs for traditional vehicles with at least one service usually recommended at every 5k-10k km sums up to be INR 90,000 for approximately 1.60 lakh km. Electric vehicles whereas do not require oil changes, oil filters, or spark plug replacements. They require much fewer liquids and moving parts. Hence, the maintenance cost drops down drastically between half to a third as compared to ICE vehicles.
EVs do not emit any toxic gases as compared with their traditional counterparts that are responsible for releasing harmful gases such as carbon dioxide, carbon monoxide, nitrogen oxides, etc. Hence, electric vehicles are environmentally friendly and contribute in improving air quality. For instance, an EV powered by renewable electricity leads to zilch emission of greenhouse gases.
Adding to it, commercial fleets can also benefit from deploying EVs as they will be able to attain high levels of employee satisfaction along with improved performance and greater retention levels. The drivers specifically enjoy the smooth and noiseless ride on a vehicle that does not release toxic fumes. The fact that they are operating a cutting-edge technology further motivates them to deliver their best. This increased retention level can further lead to a reduction in the costs of training and hiring the employees.
Electric vehicles with their plethora of state-of-the-art benefits enable operational efficiencies in commercial fleets. Taking an example, on using EVs, the drivers’ frequent trips to the gas stations would reduce. This will further reduce employee downtime when fleets have to deliver parcels specifically in rural areas.
The future of the electric vehicles market in commercial fleets segment indeed seems to be promising. With the exponentially rising demand for EVs, the need for the installation of charging infrastructure for commercial usage will also spike. As per CEEW Centre for Energy Finance report, the Indian EV market will be valued at $206 billion by 2030 if the country continues the pace of its steady progress. This would further lead to a $180 billion investment in the vehicle manufacturing and charging infrastructure segments.
For businesses and fleet operators in employee transport, ride-hailing or deliveries, the utilization is around 150-200 km a day
Another major benefit of owning EVs is that one does not need to convert the entire fleet at once. You can start with installing just one or two charging EV stations with just a few electric fleet vehicles. By incorporating electric vehicles, commercial fleets businesses would also be able to enjoy a competitive edge in the market. While saving costs, they would be able to gain extra revenues by installing charging stations in their spaces.
For businesses and fleet operators in employee transport, ride-hailing or deliveries, the utilization is around 150-200 km a day. The difference in upfront costs can be bridged within 10-12 months by running more EVs at the same distance. Thus, the transition to EVs is a viable strategy for commercial fleets as it will lower cost, save time, and well as reduce Scope three emissions!