Monday, April 9, 2012
EVI works to electrify U.S. commercial transport
The Stockton, Calif.-based zero-emission commercial truck builder has deals in the works with Frito-Lay North America and UPS. The orders and its development of a hybrid truck mean more jobs are on the way, adding 30 people to existing staff of 40.
Frank Jenkins, EVI vice president of sales and marketing, talks about his company's progress and why it's bullish on California and the future of electric vehicles.
The direction of the EV industry
The electrification of America's roadways has distinct components, at least from Jenkins' perspective. "When we talk about our industry, it's diverse," he says. "You have cars, light-duty trucks, then you have the heavy-duty" trucks that EVI builds.
The automotive sector is filled with the likes of the Nissan Leaf, Chevy Volt, Tesla's Roadster and upcoming sedan and SUV, plus a bunch of others waiting in the wings. Hybrids appear to be morphing a bit, too. Toyota's Prius is debuting multiple models, even offering a plug-in version.
Jenkins says electric vehicle demand will fluctuate. It's struggling somewhat now as is evidenced by General Motors' decision to put manufacturing of the Volt on temporary hiatus. Yet reports of Volt sales show a bounce with March sales setting a record. "The decision to buy is based on emotion more than anything else," Jenkins says.
A truck, on the other hand, is a tool for business. "It's an asset they use to get the job done," he says. "It has to make good business sense." And "it's a lot easier for a commercial customer to buy one of these."
While the truck market took a hit with the economy, it's since mostly recovered. Jenkins says the forecast for medium-duty is pretty large -- "40 percent to 2020." The majority of that growth will be in the United States and Asia, mainly "because it makes good business sense because of significant savings in fuel and maintenance costs."
Diesel or electric?
Electric trucks are great for consistent routes. The range of the EVI MD, for instance, is about 90 miles. Its top speed is 65 mph, and it uses a 99 kilowatt hour lithium phosphate battery system from Austin, Texas-based Valence Technology.
Jenkins predicts more trucking companies will make the switch to electric once they better understand the segment's value. He says return on investment for electric driveline components is three to five years. The cost of the electric trucks is about twice that of diesel, but, Jenkins says, as sales increase the price differential will decline. "The biggest part of that cost is batteries, and they're forecast to drop," he says. "It's based on economies of scale."
Jenkins says New York and New Jersey offer companies incentives that help his industry and others as they work to clean the air. In California, where clean air is also a big political issue, efforts also are under way to promote electrification of the roadways.
In fact, California awarded Electric Vehicles International $1,153,053 to design, develop and deploy a range-extended electric vehicle powertrain for medium-duty truck applications through its Alternative and Renewable Fuel and Vehicle Technology Program. EVI proposes to build 10 Range-extended liquified natural gas medium-duty pickup trucks, using the Valence lithium-phosphate batteries for a 100 to 115 mile range. EVI is to integrate the new powertrain into an industry standard pickup truck and will deploy prototypes for on-site testing with partners, according to a California Energy Commission report.
The good thing about being a pioneer in the business is the lack of competition. Currently, it appears big-name truck manufacturers are sitting back and waiting for smaller outfits like EVI and Smith Electric Vehicles Corp., based in Kansas City, Mo. to take all the initial niche-building risks.
Smith announced the launch of its Newton Step Van in Indianapolis at the NTEA Work Truck Show in March. The company has inked a deal with FedEx Express that inspired Bryan Hansel, CEO and chairman of Smith, to say Smith looks forward "to successful vehicle deployments that demonstrate the economic and environmental benefits of fleet electrification."
The Newton Step Van has a range similar to that of EVI.
In addition, Freightliner has developed the M2 106 Hybrid powered by the Cummins ISB 6.7 liter engine. The company also has worked with Tesla on an all-electric version.
EVI's hybrid Range Extended Electric Vehicle, or REEV, developed in partnership with the CEC and Pacific Gas and Electric Co. has that market covered as well. The plug-in hybrid boasts 40 miles in all-electric mode with extended range in hybrid mode limited only by fuel tank capacity. It offers 30 percent fuel savings.
The potential to making a believer of a company like Frito-Lay
It's big. But first, an electric truck must prove itself, Jenkins says. "It has to carry that load. It has to meet their needs in terms of performance. And we've done that." The next step is paying for the product. Jenkins says a company must achieve its return on investment and that will come with volume.
More trucks sold mean the price will drop. Once you get commercial customers buying the product and the volume up, there will be no need for incentives, he says. EVI also has the added ability to adapt a product to the specific needs of a client. All the specialists and engineers who know the product inside and out are on staff. They know how everything works and how it can be tweaked to achieve perfection.
Jenkins calls it "optimized driveability."
From GM to electric
Jenkins is a veteran of the industry. For 28 years he worked for General Motors in its fleet and commercial segment. There, he developed a majority of its marketing programs so he's quite familiar with what it takes to get a buyer to notice a new rig and plunk down the cash.
"It's the industry I love and the business I know," he says. "And I'm a true believer in the growth of hybrids and EVs."
Jenkins is also a believer in the importance of shedding some of the nation's reliance on foreign oil in the name of security -- of the nation and the economy. "We don't have to rely solely on gas," he says.
The biggest hurdle
"The price point," Jenkins says. "You have to build a product to get the job done, and we're pretty good at that. That's just a given."
He says past manufacturers on the international market produced equipment that didn't meet expectations, making EVI have to prove itself. "They have to try it and drive it," he says of prospective clients. "I have to jump through hoops to prove it can do the job."
If EVI’s success continues, there is a chance more companies may be attracted to the San Joaquin Valley.
Jenkins says he's noticing increased interest from key players. But he cautions, it doesn't mean a big company will move operations into Stockton. However, it may mean a big company will seek out EVI to work jointly on a project.