We are at the beginning of something exciting: combining vehicle management with energy management and potentially with MaaS.
Transportation is entering a period of immense change.
Measurable degrees of global warming have developed into iconic images of destruction and tragedy from floods, hurricanes, and wildfires. With the public demanding change, governments around the world are determined to curtail the worst of the impacts by significantly reducing carbon emissions.
In the United States, the Environmental Protection Agency (EPA) says that today, around 29 per cent of carbon emissions come from transportation. Therefore, to assist in curtailing climate change, as well as air pollution, a transition towards electric vehicles is inevitable, and welcome.
This means that our mobility will no longer be based on the supply chain parameters of oil and gas, but how electricity can be delivered to our vehicles. While charging takes longer, it opens up a whole bunch of new possibilities, not the least being a very significant reduction in cost for maintenance and energy needs, which is music to the ears of both consumers and fleets alike.
From a fleet management perspective, the last five years has seen a huge growth in the tracking and management of vehicles, allowing processes to be optimized and vehicles bought and sold at the most appropriate times.
The Internet of Things (IoT) devices have generated many new insights and points of reference that have become a real “eye-opener” for managers, enabling fleets to improve safety and reduce cost.
However, we’re right at the beginning of something even more exciting: combining vehicle management with energy management, and potentially, with Mobility as a Service.
New opportunities for fleet owners and dealers
Tesla owners have already seen an early window of this technology. When charging, an app seamlessly connects to the car, lets you know when charging is complete, and charges your credit card when done.
But it’s not as seamless as it appears, out there, when charging by other systems. And in fact, it can be a bit of a mess. Because of this, most fleets don’t have a good handle of where and when to charge and how it should be managed. In fact, it can be rather intimidating.
I recently spoke with Jane Hoffer, CEO of GoWithFlow — a Portuguese sustainable mobility management startup backed by the energy giant Galp — and asked her where she sees the challenges and opportunities, especially for corporate fleets.
Hoffer agrees that there is a big gap in charging interoperability for users of electric vehicles, with many different companies having their own app and protocols. If you’ve ever stood outside a charger with five miles of range left on your car in -10ºC temperature trying to download a new app on your smartphone to charge the car, you’ll know how frustrating this is.
Acting as an integrator allows fleet drivers to use most charging stations off just one app.
The second area she sees as an early win for customers is cost: “GoWithFlow customers save an average of 225€ (approximately CA$350) per vehicle per year when they switch to electric. The lower maintenance and energy costs are quick returns.”
Some things are known, and I suspect that these sorts of savings could grow fairly quickly as governments continue to encourage EV adoption.
Energy management as a fleet imperative
What is less known is how to use the fluctuations in electricity demand and pricing to your advantage.
While peak electricity spot prices can be brutal, they can also reach lows — so low, in fact, that sometimes an energy company will pay you to use electricity! Many areas often have excess wind and solar energy and need to be switched off to prevent the grid being overloaded.
In situations like this EVs can act as “sinks”: when batteries can be charged cheaply when there is excess energy in the system. IoT monitoring and software controls enables this to occur seamlessly and at exactly the right point in time.
Depending on the location and usage of the vehicles, fleets may even look to take it one step further by installing their own micro-grid with batteries and solar panel charging — a particularly appealing option for fleets with large trucks and buses.
However, for fleets, there’s another problem: plug-in hybrids. In concept, these vehicles are great; an electric motor with a moderate-sized battery powers the vehicle in most commuting situations, charged from an outlet — and with limited gasoline or diesel charging the battery as needed for longer trips.
Private owners who religiously charge from home have seen very low fuel consumption results. The problem is that no company car driver is going to be plugging in at home if they’re not reimbursed for the energy that they use. This has created a situation where drivers never plug in, meaning the car must operate like a conventional hybrid, not significantly reducing fuel consumption or emissions.
Using an energy management platform integrated with IoT monitoring allows fleets to track energy use from home, and in some situations, send the bill directly to the fleet operator. When company vehicles are fully electric, such a system becomes even more important.
Hoffer sees the potential of platforms as more than energy alone. “We first ask: what is best for the user and company on each journey? We therefore suggest that a platform must be all in one, holistic to both the fleet manager and driver.”
That means the potential to use one platform to help drivers and users make better decisions per trip by integrating Mobility as a Service into a fleet and energy management platform.
For example, why not take Uber when you’re going to a place where the cost of parking is high? Why not take a bike from Lime or Bird if it’s sunny and you’re not going far? You can even build a rewards program that incentivizes drivers and users to take the best options at the right times, cultivating loyalty and saving the company money.
The learnings here are twofold:
First, vehicle electrification when combined with IoT becomes a huge enabler for fleets to save money. Today, this is rapidly becoming a competitive advantage. Tomorrow, those who are still driving IC vehicles will see this as a wasteful OPEX burden.
Second, and just as importantly, thinking about mobility and therefore fleet operations in a holistic manner can change the way fleets do business for the better. It’s not just about vehicles, it’s about moving goods and people, and thinking from that first principle creates a raft of new options.
So what should fleets do from here on in? At Vision Mobility, we recommend all businesses ask two important questions:
1) Can an electric vehicle do the job?
2) How much can I save or how much extra value can I generate with an EV?
New longer range batteries and a growing selection of vehicles are answering most use cases today, but it is the growing value proposition for fleet managers that really sets them apart.
Why should retailers care about fleet operations? It’s simple: many dealers still deal with and deliver vehicles to small fleets. Offering them access to an integrated fleet management platform to help business owners lower their cost of vehicle operation through efficient energy management and vehicle usage is a very valuable business office tool.
These buyers typically do not benefit from the economies of scale of large fleets, so these sorts of partnerships can offer real benefits. Yet for the dealer it also becomes a window to service and maintenance opportunities, as well as vehicle resale and upgrade times.
EVs, when combined with a holistic operating platform, is what will really differentiate cutting-edge fleets and dealerships in the near future. And given the changing conditions of our planet, the imperative is on us today to act fast.