the IC engine.
The determination of electric motors will be driven by vehicle usage combined with the initial cost and operational costs.
For example, Categories 1 through 3 and 4 through 6 trucks will be suitable for use during the day and charging at night. This is most likely a strong market for truck EV sales.
Delivery trucks such as those used by UPS and Fed Ex are good candidates as they are delivering during the day and parked (for re-charging) over night. School buses would be similar as they pick up and discharge children in the morning and late afternoon; then are parked overnight. The initial cost of electric vehicles is higher than traditional IC engines, so usage will play a large part. Table 2.6 show data on average annual miles driven.
Table 2.6 Truck Category Average Annual Miles.2
| Category | Average Annual Miles Driven |
|---|---|
| Delivery truck (e.g., UPS) | 12,500 |
| School bus | 11,000 |
| City transit bus | 42,000 |
| Class 8 semi-truck | 63,000 |
| Postal Service (USPS) long-life trucks | 5,100 |
If we consider the United States Postal Service (USPS), their full fleet of delivery trucks uses 85 million gallons of fuel per year.3 The current average price for gasoline (July 2021) is $3.22, so annual fuel costs for the whole USPS delivery fleet would be:
85 million gallons × $3.22 per gal = $273.7 million dollars annual fuel costs.
One EV USPS delivery truck electricity cost:
212,000 trucks × $408 = $86,496,000. This means, operationally, USPS could save about $187 million per year in fuel costs by switching to EVs. Of course, this does not consider the following:
Additional Costs
Capital costs to install electric charging stations
The initial higher cost of EV trucks
Cost Savings
Federal tax credits for switching to EVs
Significantly lower maintenance costs (primarily tires and brakes).
There are approximately 212,000 vehicles in the delivery fleet. The USPS fleet would be an optimal target for EV sales as they are out for delivery during the day and back to the fleet station to charge overnight.
There are many opportunities for companies looking to affiliate with the coming EV market. Table 2.7, on New EV Opportunities, outlines a few of them.
Table 2.7 Potential New EV Opportunities.
| Opportunity | Companies or Industries |
|---|---|
| Charging station manufacturers and installers | Siemens, General Electric, Tesla, and many others. |
| Truck stops and gas (charging) stations | All along highways and secondary roads, a new, extensive network of charging stations will be required. Current gas stations, malls, and restaurants are likely users. |
| Utilities | EV charging may represent large electric sales in off-peak (overnight) hours. This may increase the need for new (but cleaner), power plants. |
| Manufacturers and dealers | All car and truck manufacturers and their dealer networks will be on the forefront of EV technology implementation. |
| Battery manufacturers | Those firms that will supply auto/truck makers with new lithium or similar batteries. |
| Battery recycling | With more and larger batteries on the road, at some point there will be a need to recycle or safely dispose of car/truck batteries. |
| Rare mineral extraction companies (i.e., lithium) | Most EV car batteries use lithium as a core component. Lithium is not common in all countries and there are a limited number of companies in this specific mining extraction business. |
| Home builders and electrical contractors | EV will require car charging stations in both existing homes and new homes. This represents a lucrative business opportunity. |
Table developed by David Tennant.
Note that disruptive technologies can provide opportunities for new business creations in the areas of new products, product support, spin-off businesses, and jobs. Federal, state, and local areas consider subsidies as a positive feature for the following reasons:
Subsidies are used to move the economy from one form of business to another. In the case of EVs, from a polluting energy fuel to a cleaner fuel source.
It creates jobs, and therefore economic activity and a tax base.
New technologies keep industry competitive at home and abroad.
The above table lists just a few of the opportunities that EV vehicles will offer to large companies and entrepreneurs alike. There will be many spin-off companies as a resulting shift in transportation focus.
Other Marketing Considerations
It must be emphasized that numbers on paper always look optimistic and tough questions should be asked in our market evaluation for both cars and trucks. Consider the following:
With both cars and trucks growing in popularity, this means the utility electric system, the “grid,” will see additional loads. In the United States, the grid system is not entirely consistent. In the Southeast, there is ample excess power, so straining the system is not considered an issue for the short term. Longer term planning will certainly be needed.
Some areas of the country, primarily on the West Coast, utilities may struggle to meet this new demand without building new power plant capacity. How does this impact your marketing targets for EVs of any kind? Further, California has designated that only zero emission cars can be sold beginning in 2035. How will this impact the electrical system? How will this impact utilities, car dealers, and most of all, the residents of California? What does this mean if you are a car dealer in California? If you’re an entrepreneur, does this open an opportunity?
Many utilities have been shifting from coal to cleaner forms of energy, primarily natural gas, solar and wind power. If the price of natural gas increases (while the price of gasoline might decrease), what are the implications? As a marketing professional, does this make you rethink the opportunities or do alternative opportunities arise?
Most likely, a marketing group would develop several models (that is, an Excel spreadsheet) that