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Issue Date: Vol. 51, No. 2, February 2011, Posted On: 2/19/2011


Start Your Engines, Or Your Motors: Industry Leaders Blaze Trail For 'Greener' Route Vehicles


Emily Jed
Emily@vendingtimes.net
vending, vending machine, vending machine business, vending supplies, vending operator, vendor, vender, Obama administration, alternative power, alternative energy, Compass Group North America, Canteen Vending Services, fuel efficiency, carbon footprint, electric trucks, hybrid vehicles, electric vehicles, gas prices, North Central Texas Alternative Fuel and Advanced Technology Investments, Clean Cities Coalition, Dallas-Ft. Worth Clean Cities Coalition, U.S. Department of Energy, American Recovery and Reinvestment Act, North Central Texas Council of Governments, zero-emission, Smith Electric Vehicles, Newton truck, charging station, Jim Doncaster, route delivery vehicle, Navistar, Navistar eStar, eStar, Utilimaster, Ford, commercial truck, medium-duty truck, Ford E-Series, flex-fuel, Federal Express, United Parcel Service, gasoline-electric hybrid, E85, Ford Transit Connect, Ford Econoline, fleet, green fleets, Bryan Hansel, Coca-Cola, Larry Eils, NAMA, National Automatic Merchandising Association, CNG, compressed natural gas, Environmental Protection Agency, American Truck Dealers, National Automobile Dealers Association, Lisa Jackson, Chris Kielich, Zap, Zap XL, Alex Campbell, lithium battery, Navistar, Roy Wiley, Avi Mordekovich, PM Savvy Service Inc., foreign oil, Azure Dynamics,

Canteen Truck

With gasoline and diesel oil increasing in price and the first-ever fuel-economy standards for commercial vehicles being drafted by the Obama administration, the shift from conventional to alternative power is beginning to accelerate, aided by recognition that "green" initiatives make for good public relations. A vending industry pioneer in this regard is Compass Group North America's Canteen Vending Services division (Charlotte, NC), which has systematically been pursuing its goal of increasing fuel efficiency and reducing its carbon footprint.


PHOTO: PACE SETTER-- The vending industry's dependence on delivery vehicles has driven its search for more efficient and economical transport solutions. This Canteen Vending Services gasoline-electric hybrid, currently under test, is one of many alternatives now undergoing intense scrutiny. The body is adorned with eye-catching graphics emphasizing Canteen’s commitment to protecting the environment.

With gasoline and diesel oil increasing in price and the first-ever fuel-economy standards for commercial vehicles being drafted by the Obama administration, the shift from conventional to alternative power is beginning to accelerate, aided by recognition that "green" initiatives make for good public relations. A vending industry pioneer in this regard is Compass Group North America's Canteen Vending Services division (Charlotte, NC), which has systematically been pursuing its goal of increasing fuel efficiency and reducing its carbon footprint.

Navistar DuraStar

While all-electric passenger cars are finding their place in the automotive market, trucks equipped with the technology are just beginning to hit the roads. The nation's largest vending operator is eagerly awaiting March delivery of four battery-powered vans, which it will test in the Dallas market. This initiative is a North Central Texas Alternative Fuel and Advanced Technology Investments grant project, under the Dallas-Ft. Worth Clean Cities Coalition, the U.S. Department of Energy (through the American Recovery and Reinvestment Act), and the North Central Texas Council of Governments.

The zero-emission Newton truck, made by Smith Electric Vehicles (Kansas City, MO), has a top speed of up to 50 mph, a range in excess of 100 miles on one battery charge and a payload of up to 16,280 lbs. It's powered by a lithium ion battery driving a 120-Kw. induction motor. The battery can be recharged in six to eight hours, using an onboard charger connected to a charging station now being planned for Canteen's Dallas vending branch. Smith has produced the Newton truck in Europe for more than three years; U.S. production began in 2010.

VEND-FRIENDLY
"We're eager to test the Smith vehicles to see if they can handle the weight of our loads, with all the drinks we transport, while maintaining the performance criteria as the batteries age," Canteen chief financial officer Steve Luccia told VT. "The nature of vending is very supportive of all-electric vehicles. With many shorter routes 10 to 12 miles long, you don't even push the limits of the range. You can plug in overnight, go out fully charged and come in with a 75% charge; it's very doable." He added that it makes the most economic sense to push the limits and deploy the trucks on routes that span as far as 100 miles round-trip, in order to maximize the environmental impact savings and ROI on the vehicle.

Jim Doncaster, field implementation manager for Canteen's purchasing group, added that Canteen's average route covers 300 miles per week. "The electric trucks fit well," he said. "Smith is the first manufacturer to make electric medium-duty commercial trucks, which fall in the 10,001-lb. to 33,000-lb. gross vehicle weight range -- right where the vending truck fits."

Canteen is also in preliminary talks with Navistar Inc. to be one of the first fleet operators to test an electric panel truck that the Warrenville, IL, manufacturer plans to launch later this year. "It's a box truck custom-built from the ground up, very much like the model Utilimaster makes, and it seems to offer the footprint and capability that has promise for the industry," said Luccia.

Last year, Navistar began rolling out its first eStar zero-emissions all-electric medium-duty truck, a class 2c-3 vehicle with a 14-ft. or 16-ft. fiberglass van body and a 4,000-lb. payload; it was designed primarily for package delivery fleets. Federal Express and United Parcel Service are two of its initial customers, and have taken delivery of 80 vehicles at this writing. The manufacturer explained that the vehicle was designed primarily to be used by drivers for local deliveries where stop-and-go driving otherwise would consume a large amount of fuel. The new model, slated for introduction this year, is designed for the same driving patterns.

Doncaster also told VT that Canteen has been testing a medium-duty gasoline-electric hybrid truck manufactured by Azure Dynamics (Oak Park, MI) at Indiana's Purdue University for the past year. This vehicle is built on a Ford E Series chassis refitted with an electric motor, a battery and a regenerative braking system that recovers energy, extending battery life. Doncaster said the company has seen some fuel savings, but has not yet fully evaluated the early results.

FLEX FUEL
The vending giant's fleet also includes 45 "flex-fuel" vans that run on E85, a mixture of gasoline and ethanol. Among the benefits of E85 over conventional gasoline-powered vehicles is the potential for localized production of fuel in agricultural areas and reduced emission of pollutants.

"We actually get 15% to 20% less mile­age from our flex-fuel vehicles, but they're very helpful from a clean-air perspective in certain markets," said Luccia. He added that when Canteen experienced disruptions in deliveries through the local oil pipeline during Hurricane Katrina, E85 was the only fuel available in abundance, without waiting, and it kept Canteen's drivers on the road during a very trying time.

Doncaster said that, despite the modest premium it costs to operate the vehicles, Canteen will continue to replace the vans it retires from its fleet of 700 with flex-fuel models, and is keeping its eye on emerging green technologies.

Another move the company has made in recent years is to downsize its service vans from Ford's larger Econolines to the streamlined Ford Transit Connect, with 50% greater fuel efficiency. Luccia observed that such vans may become electric in the not-too-distant future. "The electric vehicle market is just beginning to take shape.There is a lot of opportunity for growth," he commented.

Canteen marketing manager Cynthia Karst observed that the most progress has been achieved in making diesel trucks "greener," with a slower pace of innovation in gasoline vehicles. "Smith Electric's is the first vehicle that works within our business model, and we jumped at the opportunity to include it in our fleet," she said. "Converting to 'greener' trucks is a really important part of Canteen's sustainable philosophy. Because of our size, we can make a big impact when we change the way we operate our trucks."

Over the next five years, as the company replaces vehicles in its fleet of 2,500 trucks and vans, a significant portion of Canteen's fleet will be "eco-friendly" models. "We see it almost as our responsibility to lead the industry, because of our size," Luccia said. Canteen has a 200-branch network of company and franchise business units that serve locations in 48 states.

LIGHTER LOADS
Furthering its fleet "greening" initiatives, Canteen will begin piloting a prekitting "pick-to-light" system in April. "Our systems are now capable of accurately predicting a machine's product needs," said Luccia. "Based on this prediction, unique orders by machine will be picked daily and loaded into tote bins. This system will greatly reduce the inventory maintained on the truck, increasing fuel efficiency. The totes will be transported in the 'greener' fleet over time." He added that the lessons Canteen learns and the business practices it establishes will be shared with its 126 franchisees.

PepsiCo's Frito-Lay subsidiary is another large industry player pioneering the use of "greener" fleet technology. The snackmaker has a growing number of Smith's all-electric vehicles on the road, and is reportedly moving quickly toward its goal of having 182 of the trucks in its delivery fleet by the end of 2011.

"Frito-Lay's truck program is a significant step forward in the advancement of electric vehicles," said Bryan Hansel, chief executive officer of Smith Electric Vehicles. "Businesses will improve their environmental impact and see cost savings with the reduction of fossil fuels. More importantly, the insights gained operating in urban environments will be invaluable in extending electric vehicle technology to consumer markets in the future." Coca-Cola has also added Smith all-electric trucks to its operations, including some of its vending fleets, Hansel said.

Electric trucks also may be seen on the industry's supply side in the not-too-distant future. The company reports that it has received orders for its early model eStar electric trucks from large beverage companies.

SEEING GREEN
"We've been preaching alternative fuels for a long time, but it's only recently that operators are beginning to take notice and action," said Larry Eils, who retired as senior director of technical services for the National Automatic Merchandising Association and now serves as a NAMA knowledge source partner on health, safety and technical standards. "We've given presentations at vending shows on converting to natural gas, which remains a very viable alternative to gasoline. Some operators have even experimented with using cooking oil as fuel. These days there's a lot of attention on hybrid and electric vehicles."

He commended Canteen for taking the lead, noting that adopting greener technologies requires a large upfront investment, and most operators are hesitant to take the leap without the confidence that it has a proven vending application.

"It's great for the industry if Canteen tests an electric fleet, and sets up charging stations in its warehouses where trucks can plug in and take off the next day," said Eils. "They can give the industry a sneak peek into how far the vehicles can go, and work out any glitches."

With mounting operating costs fueling industry interest in "greener" fleets, Eils said operators have been taking the first step by optimizing their routes, which he regards as a sensible approach.

"Our industry is finally making changes in how a route operates, and cutting their routes down so they have fewer trucks on the road," he said. "That's one big way to economize and reduce fuel consumption, even before looking at alternative fuels -- which will be next, because we can't run around on gasoline forever."
With the toll the economy has taken on the industry, Eils said he does not expect a rapid investment in new technology by most independent operators, but rather, a gradual progression. "Our guys are just trying to hang on, and the most cost-effective way is to reduce the number of trucks they're using," he said. "Most are not ready to make the costly upfront investment in these newer vehicles, or to retrofit the ones they have for alternative fuels. But it's certainly something to pay attention to, because it's all heading rapidly that way."

In addition to electric trucks, Eils noted that many fleets outside the industry, including buses and taxis in urban environments, are converting their vehicles to alternative fuels such as compressed natural gas, both in response to emissions regulations and for cost savings. "The upfront investment is hard to swallow, but then you save money and get the return on your investment, because CNG costs far less than gasoline, the price of which keeps going up," he said.

Even operators who stick with conventional gas-powered route vehicles will be purchasing "greener" models as these come off the assembly line. The Obama administration announced last fall that it is moving toward creating the first-ever fuel economy standards for commercial vehicles. Unveiled jointly by the Environmental Protection Agency and the Department of Transportation, the proposal builds on the first phase of historic new federal rules that, for the first time, set national greenhouse gas emissions standards for passenger cars and lightweight trucks, and demand substantially increased fuel efficiency.

Starting with the 2012 model year, the new rules for cars require automakers to improve fleetwide fuel economy and reduce greenhouse gas emissions by approximately 5% in each model year, reaching an estimated 34.1 miles per gallon for the 2016 model year. According to published reports, the American Truck Dealers unit of the National Automobile Dealers Association has warned that the proposed EPA rules could add thousands of dollars to the price of a truck. "We are concerned that this could price some buyers out of the market," the trade group observed. (EPA chief Lisa Jackson has countered by stating that the new standards can bolster small-business profits by reducing fuel costs.)

Accelerating the push beyond gasoline-powered vehicles, the U.S. government, through the Department of Energy's Vehicle Technologies Program under the American Recovery and Reinvestment Act, has earmarked $2.4 billion in funding to support domestic manufacturing and deployment of electric vehicles and components. In addition, DOE Clean Cities coalitions across the country are working with local stakeholders to adopt technologies that reduce petroleum use, including encouraging of electric vehicle use.

Smith Electric Vehicles received a $32 million Recovery Act award to lower the price tag of its first 500 trucks, and Navistar was granted $39.2 million to help develop and deploy its first 400 plug-in delivery trucks.

"Data gathered from these projects will help the Vehicle Technologies Program better understand how fleets use these types of vehicles and how the program can support their deployment in delivery applications in the future," Department of Energy spokesperson Chris Kielich told VT. "The vending industry may benefit from the introduction of electric vehicles, because these types of fleets already have preset routes and central refueling, which are ideal for electric vehicles."

Smith Electric produced a few hundred vehicles in 2010, and is quickly moving toward rolling thousands of them off its production line, according to chief executive Bryan Hansel. "Demand is very good. The economics are very powerful for the short and long term," Hansel told VT. "It's a niche product for a fixed route with a predictable daily duty cycle. That's exactly where we fit."

COMING DOWN THE PIKE
The Smith chief said the company plans to expand its zero-emission product line to include smaller gross vehicle weight models with wider vending route applications late in 2011 or early next year.

"To people who are taking their time waiting for something to happen in the future with electric vehicles, the reality is that it's already happening -- and worth looking into," he advised.

Zap TrucksAnother pioneering commercial electric vehicle manufacturer is Santa Rosa, CA-based Zap. Like Smith Electric, its vehicles are best suited for fixed delivery routes and are primarily used on city streets, according to spokesperson Alex Campbell. Its most popular commercial model is the Zap XL, an economical light truck fitted with a conventional lead-acid battery. The Zap XL averages 25 miles on a charge; it can be upgraded to a lithium battery that extends its range to 40 miles.


PHOTO: Zaptruck XL (l.) zero-emmissions box truck has a 110V. onboard charger and 108-cu.ft. cargo capacity. Zap Xebra (r.) electric vehicles are being used for inter-neighborhood deliveries. Xebra specs: Top speed: 40 mph Range: 25 miles Weight capacity: 1,800 lbs.

Campbell said the company has been producing its electric vehicles for the past three years, with a growing customer base that includes pizza delivery drivers, florists and other local businesses that benefit from economical short-range transportation.

THE ELECTRIC ADVANTAGE
"It's ideal in many delivery operations to have smaller, 'clean' vehicles spidering into communities where it's hard to get parking, and drivers usually leave their vehicles idling," he commented. "Electric trucks have virtually no emissions. They make almost no noise, which is great in a city environment. And insurance is likely to go down because you're not driving a high-speed highway-type vehicle on an urban route -- you're driving the right size vehicle for the job." The cost to charge Zap's XL is about 2¢ a mile compared with a fuel cost of 15¢ to 30¢ a mile for a conventional gas delivery van, he pointed out.

He explained that maintaining a battery-powered vehicle costs at least a third less than its conventional gas-powered counterpart. The main reason is that plug-in vehicles don't have the moving parts of an internal combustion engine, including fans, belts and sparkplugs. "You don't have to worry about oil changes, tune-ups and emissions tests," Campbell pointed out. "You have just one moving part, the electric motor, and you just have to plug the vehicle in after use." Moreover, today's electric trucks use "regenerative" braking, which converts to electricity some of the energy expended in slowing the vehicle and returns it to the battery, Campbell noted. And that energy is not wasted as friction, which spares the brake linings and extends their lives.
The Zap spokesperson recognizes that the battery life of current electric vehicles does limit their applications. For the many fleets with longer operating ranges, he observed that hybrid gas-electric vehicles present a viable fuel-saving, emissions-reducing alternative.

"There's an appetite for cleaner transportation. President Obama is really pushing it," said Campbell. "Now the industry needs to get enough of them out there so they're affordable to the mainstream public. There's not an adequate supply on the market; you can still count one hand the places you can go, and the ones that are available are very expensive." Zap, he said, keeps costs down by manufacturing its products in China and assembling them in the U.S.

Also impeding the widespread adoption of electric vehicles, the Zap spokesperson pointed out, is that few finance companies offer leases on them because they are unsure about how to value the lease "residual," a truck's worth, after a few years of use.

COSTLY PROPOSITION
Navistar DuraStarNavistar spokesperson Roy Wiley reported that the company has a growing base of customers, including vending operators, using its hybrid diesel-electric DuraStar box truck for delivery applications. He agreed with Zap's Campbell, however, that the high cost of the first generation of electric trucks, despite the savings in fuel costs down the road, is one barrier to their becoming mainstream -- as is often the case with emerging technology.

"There's definitely demand for them right now, especially in city delivery applications," Wiley told VT. "But it is a work in progress." He pointed out that the cost of just under $150,000 for one of its all-electric trucks is prohibitive for most fleet operators. Likewise, a Smith truck costs about $100,000, compared with about $60,000 for a similar diesel model.

"The other limitation is the length of the battery life," Wiley continued. "I don't think the demand will skyrocket until the cost comes down and longer-life batteries are addressed, which will happen."

CHARGING AHEAD
Questions also remain about development of the infrastructure to charge plug-in battery-powered vehicles, said Avi Mordekovich, vice-president of PM Savvy Service Inc. (Fresh Meadows, NY), who operates 60 vehicle repair and gas stations throughout the U.S.

"An average car can go 300 miles before filling up, but electric vehicles have to be charged after 100," he commented. "It will be a while before electric vehicles are employed beyond local use, where they can be charged in a person's or business's garage overnight."

The U.S. Department of Energy is doing its part to help build the necessary infrastructure to assure drivers they will not run out of juice before they complete their run. California-based manufacturer Coulomb Technologies Inc., for example, received $15 million in federal stimulus funds from the DOE for its ChargePoint America program to install 4,800 public and home charging stations in nine metropolitan areas.

In addition to stand-alone stations near shopping venues and offices that will allow drivers to shop or work while their cars charge, these facilities also have a place in many existing gas stations, said Mordekovich.

"The technology needs more time to evolve; you need the space in gas stations for a car to charge for at least an hour," said the veteran service station operator. "And most people don't want to wait that long; they can barely wait for the average three- to five-minute fill at the gas pump." While short-range electric route vehicles will not encounter the same inconveniences as early adopted passenger cars, refinements to infrastructure designed for those passenger vehicles will expand the potential uses for the trucks.

With gas prices escalating, Mordekovich sees compressed natural gas as an excellent alternative, since it's an abundant resource that reduces the nation's dependence on foreign oil, and reduces pollutant emissions almost to zero.

Delivery vehicles that run on CNG are readily available from truckmakers like Ford and Freightliner, yet the limited number of filling stations available is a big reason they do not enjoy wider use, according to Mordekovich. He anticipates that more and more will appear, since filling up with natural gas costs significantly less than gasoline or diesel, and refueling takes no longer than tanking up with gasoline. Refueling appliances can also be installed in a garage or outside a building, to allow refilling a vehicle's tank from a home's or business's existing natural gas supply.

"If I were a fleet operator in the market for a new vehicle right now, I would invest in a hybrid," he said. "The technology is proven, you can drive as long, as far as you want and you can fuel up the conventional way. When you're not accelerating the engine, it shuts down and the vehicle operates on the battery, saving fuel consumption and reducing emissions. It's the best of both worlds."

Unfortunately, what needs to happen for a big move away from gasoline and a major leap in the development and adoption of alternatives in this country is for the price of gasoline to rise to $6 a gallon in Mor­dekovich's opinion.

"In my 25 years in this business, I've seen prices go up and down," he said. "Unfortunately, petroleum is a commodity controlled overseas. I think the price will only go up, as we use fossil fuels; as consumption goes up, the availability goes down. This winter, I think it will reach the $4 mark. Going into alternative fuels is critical."

 



Who Makes Them

Ford Transit Connect

Azure Dynamics is a public company headquartered in Oak Park, MI (a Detroit suburb); it maintains offices in Boston, as well as Toronto and Vancouver in Canada, and London. It has collaborated with Ford Motor Co. to produce the Transit Connect Electric delivery vehicle, designed for commercial fleet operators. Visit azuredynamics.com.

Navistar eStar1

Navistar International, formed in 1986 from the truck and engine business units of the historic International Harvester organization established in 1902, is the first manufacturer to commence "line" production of hybrid-power commercial trucks. Its Dura­Star is a diesel-electric medium-duty vehicle; the new eStar all-electric truck (pictured here) is fitted with a "quick-change" battery cassette that permits operating the vehicle around the clock. Go to navistar.com.

Smith Electric Vehicles was established in 1920, and has built a wide range of electric road and rail vehicles over the decades. Smith Electric U.S. licensed Smith's technology in 2009, and rolled out the Smith Newton in the United States. The U.S. organization is based in Kansas City, MO.  Visit smithelectric.com.

ZAP was incorporated in 1994 as ZAP Power Systems ("ZAP" stands for Zero Air Pollution). It offers a variety of battery-powered commercial and personal vehicles, including the new Zaptruck XL. Zap's product line is described and illustrated at zapworld.com.

 


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