Alternative Transportation Fleet Investments

GE recently opened a facility in Eden Prairie, Minnesota where companies can check out vehicles powered by alternative energy sources.

The center, operated by GE Capital Fleet Services, already leases just about a million vehicles to companies. This facility just adds a whole new dimension to the endeavor.

One of the cars available for a test drive around the facility’s test track is a Navistar eStar, which is an electric delivery truck that can get about 100 miles to the charge.

Last Thursday, FedEx’s chief engineer Keshav Sondhi took the vehicle for a spin. The company already has more than 50 of these vehicles for densely populated markets like New York and Chicago. Sondhi believes that 50 vehicles is just the beginning, explaining, “A third, one-third of our fleet could be all electric…all our urban routes could be conducive to electric vehicles.” A third of the fleet would be just about 9,000 trucks.

While the eStar costs about a fifth of what it takes to operate a gas-powered truck, the current initial price tag is steep, the price being $150,000. However, FedEx isn’t balking at that number because, as Sondhi stated, “The guiding principle is truly independence from foreign oil…that’s out chairman’s mantra: independence from foreign oil.”

Many other vehicles are available at the GE facility ranging from the Chevy Volt to massive garbage trucks powered by natural gas. All of these vehicles will be available for testing and leasing.

As gas prices continue to fluctuate, GE sees many companies potentially eyeing vehicles with cheaper fueling options. Natural gas could even wind up costing less than $1 a gallon. As Richard Battersby, vice chairman of the alternative fuels committee for NAFA Fleet Management Association stated, “Combine that [cheap fuel prices] with a federal tax incentive and perhaps a rebate, and all of a sudden it’s making fiscal sense…it’s not just, ‘Hey we want to do the right thing and we want to lessen our impact on the environment.’ But now they’re looking at alternative fuels and saying, ‘Hey, we can actually help our bottom line.’”