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Are electric delivery vans inevitable?

09/07/2020 by Mark Schneider in Technology

It’s a very bold prediction but the Managing Director of SEA Electric, Tony Fairweather, believes that metropolitan delivery vehicles across Australia will be “100% electric” in as little as 5-10 years.

SEA Electric is an Australian company that assembles electric drivetrains and installs them into mass produced new vehicles which it imports without engines or gearboxes. The result is electric versions of vehicles built on a range of platforms including the Mercedes Benz Econic and the Isuzu FSR.

Speaking in a podcast on electric vehicle website The Driven, Fairweather said the total cost of ownership was crucial to the uptake of electric delivery vehicles.

“We knew that the only way we could commercialise in Australia was to develop a technology that had a payback period or break even period on the premium of the electrified platform that was suitable for a company that has shareholders or stakeholders to deem being economically viable,” Fairweather said.

“We saw that as around that five-year break-even period. So a premium up-front but then through operating cost savings to be able to pull that premium back within a five-year period and then after that for that to be cream on top,” he said.

He said in the other five countries that SEA Electric operated in there were incentives to purchase electric vehicles, making that break-even point earlier. In the USA and some other countries, the costs were lower than internal combustion engines right from the start.

Lower running costs

The lower running costs of electric vehicles don’t end with the cost of fuel by any means. SEA Electric claims maintenance costs are “virtually non-existent for electric motors”. On top of that regenerative braking that recharges the battery of electric vehicles greatly reduces brake wear and even tyre wear according to SEA Electric. As a bonus, that regenerative braking reduces noise because it reduces (though not entirely replaces) the need for exhaust brakes or air brakes.

SEA Electrics believes that without government incentives in Australia the economics of electric delivery vehicles currently works best for larger vehicles. Overcoming buyer skepticism can be a hurdle, according to Fairweather, but getting behind the wheel and driving electric vehicles with their instant torque persuades many.

On fixed routes and with vehicle range of up to 350km or more Fairweather believes that it’s easy to have confidence in the duty cycle of electric delivery vehicles. He says there’s no need for fast charging – the vehicles can be simply recharged overnight.

Limited availability

While it’s easy to see the business sense in Fairweather’s bold prediction there’s one obvious impediment to the uptake of electric delivery vehicles, and that’s their availability. Despite its ambitions SEA Electric is currently a pretty small operation and electric vehicles from other manufacturers are few and far between. Nevertheless, the interest is there, with Australia Post, Woolworths and Linfox some of the companies trying them out.

If demand ramps up that could all change quickly, however. Chinese giant BYD is entering the market while others may also be waiting in the wings. US electric vehicle maker Rivian has recently signed a deal with Amazon to deliver no less than 100,000 electric delivery vans for them from its factory in Illinois which has the capacity to produce double that number of vehicles.

Fairweather is upbeat about the future of electric commercial vehicles and believes the key to their growth and acceptance lies with the falling cost of lithium, the increasing density of batteries and the improving duty cycle of electric vehicles. Time will tell if his optimistic predictions come to pass.

Fleetcare are currently novating electric vehicles and assisting clients with integrating elective vehicles into fleet management. Talk to Fleetcare today about how we can help you with your electric vehicle needs.

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