Sustainability, which was talked about years ago by companies and then faded away, has returned to the forefront for many corporations and suppliers. However, I have to ask the question: Will we do the challenging work and not just say we want to have a sustainable community?

And that means cutting carbon emissions. From a simplistic viewpoint in ground transportation, that means moving from internal combustion engines to electric vehicles and putting more than one person in a vehicle at a time.
Companies now are including sustainability in their RFP process and want to measure it. EV sales, which had been quite robust, are now seeing a slowdown. Hertz corporation just recently started selling off a percentage of their EV fleet.

A problematic issue with electric vehicles is the infrastructure of charging stations, what type of charging stations, how well they work and, more importantly, when are they going to be deployed to the level where there is no longer ‘range anxiety.’

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We need to discuss the impact on the electrical grid of that infrastructure. Going forward, hotels, gas stations, rental car companies, chauffeur companies, business of all types will have charging stations. Then there are all of us; how many of us will go electric? Then, of course, we are going to be charging our cars at home, and for most of us, that will happen at night. Meanwhile, rental car and limo companies certainly will as they wait for airplanes to land first thing in the morning.

If we were to convert all the combustion engines to EVs, the electrical grids at this time could not manage the extra load. Changes are being made to upgrade those grids, but we are not there now. It will take time for EVs to completely replace combustion engines, and during that time we must improve the electrical grids.

Electric vehicles are currently more expensive to buy and repair. Building out the infrastructure increases the cost of doing business. Then there is the resale value of the EV, which is incredibly important to rental car companies and chauffeur-driven suppliers, and quite frankly the difference between profitability and taking a loss. Currently, buyers of EVs will take a loss at resale.

Purchase of EV fleets by suppliers is based on the percentage of EVs that are being produced by the OEMs and the commitment of the travelers to use the vehicles. So if leisure and corporate travelers do not utilize those vehicles, then there is a usage and profitability problem, and those suppliers will not be able to afford to keep them in their fleets. (Think Hertz selling their EVs.)

Charging Matters
Another topic that suppliers are looking at is who’s responsible for the vehicle charge. It is important not to allow the charge to go too low, not just because of the danger of the vehicle running out of charge before you get to your destination, but also the damage that can be done to the battery. For battery safety, it is good not to drop below 20 percent charge. Some suppliers even have a punitive charge for bringing the vehicle back with less than 20 percent. That is something that travelers and certainly corporate accounts need to pay attention to as that could increase the cost of the transaction appreciably and should be factored in.

Especially during this transition period when there are very few charging stations and given the lengthy time it takes to charge vehicles, your travelers are better off not having to recharge the vehicle before they bring it in. Not many of us have that extra time to charge an EV. It’s not like pouring gas in a gas tank, and depends on if you can find a charging station that is open and working and not already occupied.

It should be noted that a large percentage of chauffeur-driven suppliers do not have the resources or the capital investment to pay for a supercharger. It is not just the price of the supercharger, which is extremely expensive, but it is also the infrastructure. For the majority of chauffeur-driven car companies, that means an eight-hour charge, which translates into lack of utilization of the EV vehicle..

The reduction of our CO2 footprint in ground transportation is dependent on our usage of EVs and sustainability practices of companies and their travelers. Here is where it gets tricky. We must take a leap of faith if we want to be sustainable. That means companies that say they want to be sustainable are going to have to have to pay more than lip service. They are going to have to put travelers in the vehicles that the suppliers are putting in their fleets. If companies do not support the vehicles, the suppliers will not be able to keep and grow their EV fleets.

January 29, 1886, when Carl Benz applied for a patent for his “vehicle powered by a gas engine,” there were no paved roads or gas stations. Now look where we are. The electrical grid will be improved, there will be more charging stations, they will function better than they do today, battery technology will improve, and the prices of vehicles will come down. All of this will take time and we need a commitment to support this effort now, not later.

As an industry veteran with 35-plus years of service in corporate travel, Dave Kilduff is a pioneer in ground transportation procurement solutions, sales and marketing. Dave is currently Chief Revenue Officer of NYC Limo VIP and CEO of DK Consulting Group, which consults with corporate accounts on sourcing and suppliers on business development. Dave consulted with Flyte Tyme/Addison Lee for five years as Senior Vice President, Business Development and developed, launched, and managed the global ground transportation consulting practice for the CWT Solutions Group. Dave also developed the first ground transportation consulting practice for a TMC, eCLIPSE advisors/American Express Advisory. Dave had a successful 21-year career with The Hertz Corporation, including 15 years as a Divisional Vice President of Sales.