While we continue to hear about the future promise of all-electric and self-driving technologies in the automotive industry, we shouldn’t overlook the recent and immediate successes of the commercial fleet market, which has been just as innovative, if not even more so, than some of the futuristic technologies in the passenger car industry. Sure, these much hyped words and phrases are exciting, and we’re looking forward to seeing how they change the industry in the years to come. However, we’re years away from fully autonomous driving, or fully-electric vehicles taking over.
In comparison, e-commerce and last-mile delivery fleets are examples of commercial fleets that are really driving the adoption of new technologies. Examples include retailers like Amazon and Walmart that are providing quicker and faster shipping options to their customers, and package delivery fleets like UPS and FedEx that are using a range of alternative technology vehicles. Why are fleets leading the way? Because their annual vehicle mileage is so high and their MPG so low, resulting in significant annual operating costs. (By comparison, the average consumer drives only 12,000 miles per year and typically drives a conventional vehicle that already gets 20 to 40 MPG.) Fleets need higher MPG vehicle alternatives now that make sense, and some forms of vehicle electrification make economic sense today.
Here at XL, our electrified hybrid-electric (HEV) and plug-in hybrid electric (PHEV) vehicles have driven more than 55 million miles in last-mile delivery, passenger shuttle, and service applications in metropolitan areas across the country. Our on-road successes in demonstrating that electrified vehicle technologies can cut costs while seamlessly integrating into fleet operations have helped get more fleet managers thinking about additional electric options. More fleet managers are realizing that adding electric power to commercial fleets can help save money, yielding a 20 percent reduction in fuel use with a hybrid, and a 33 percent drop with a plug-in hybrid. As more commercial fleets choose to use these fuel-saving technologies, alternative solutions like this will become more widespread.
While we frequently hear about automation and a future where self-driving cars are ubiquitous, in reality, this is not the case. There are five levels of autonomy and the higher you go, the greater the technical challenges and risks, and also the opportunities. The computer systems in these vehicles need to be able to handle external environmental data to process and make the right decisions. At this point in time, while controlled tests in confined operational areas with limited numbers of vehicles are being piloted, the fully autonomous technology just isn’t mature enough yet for widespread deployment.
However, that doesn’t mean connected tech isn’t present in the industry. For example, we install a wireless connectivity system called XL Link in every single vehicle upfit with an XL Hybrids system. XL Link feeds thousands of data points into a cloud-based server. This data is then used to modify control strategies and ensure vehicles are operating at optimal levels.
Likewise, EVs receive a lot of hype for cool designs and eco-friendly promise for consumer sedans, but they are not ready for prime time for commercial fleets. The high costs, need for government incentives, range limits, and payload limits of EVs are among the reasons EVs don’t work for most of the commercial vehicle market. Additionally, driver requirements, highway speed limitations and the insufficient charging infrastructure contribute to obstacles to widespread EV adoption among fleets. Although EVs don’t work now, HEVs and PHEVs can be seamless to operate almost everywhere, save fuel and emissions, and make financial sense today.
As the automotive industry discusses new technologies, it’s important to recognize, track and assess what is actually being used successfully and the commercial fleet vehicle market is a great example of what’s possible today. While it’s good to pave a roadmap for the future, we should also consider what’s already working today, and how to expand on these successes. In the immediate future, we’ll expect to see more HEV and PHEV solutions, as well as even more connected vehicle technology.