Enterprise, FedEx betting big on electric vehicles

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Submitted by Don Bain on July 14, 2011 - 9:12PM

Enterprise Holdings is the umbrella group over Enterprise Rent-A-Car, Alamo Rent A Car and National Car Rentals. They collectively own more cars than any company in America and, according to a post today by Marc Gunther on GreenBiz.com, they are expanding their offerings of electric vehicles just as fast as they can.

Speaking at the National Summit on Energy Security in Washington, D.C. today, Andy Taylor, chairman and chief executive officer of Enterprise Holdings, stated, “We are finally getting the vehicles in some numbers.”

Fred Smith, chairman, CEO and president of FedEx Corp., also attending the summit, added, “If the goal is to displace imported oil,” he said, “there has never been a technology that offers this much opportunity.”

Still the number of EVs in their fleets are marginal. When asked about the actual numbers by Gunther via email, Lee Broughton, head of sustainability for Enterprise Holdings responded as follows:

“We have approximately 80 EVs today and just shy of a dozen Volts,” Broughton wrote. “By calendar year end we’ll have many hundreds of EVs and definitely many more Volts (provided they give them to us) and anticipate the I-miev (Mitsubishi). We also have a dozen Peugeot i-on’s in London too. All with a charging station infrastructure across the locations receiving them.”

Nissan has reportedly sold 4,000 Leaf models thus far, with 500 of them going to Enterprise Holdings – 12.5 percent of all sold. Still Enterprise owns more than a million vehicles making the EV fleet a mere drop in the bucket.

"This is a chance for our customers to rent the future today, whether it be for a test drive, fuel-efficient rental or just out of curiosity," Broughton said in the company’s statement regarding the summit. "By leveraging our large network of Enterprise Rent-A-Car neighborhood locations, we can connect drivers with electric vehicle technology right where they live and work."

Enterprise's focus on sustainable vehicle technology led it to join the Electrification Coalition in 2010 and the U.S. Department of Energy's "Clean Cities" National Clean Fleets Partnership this year. Enterprise Holdings also is investing heavily in alternative vehicle and fuel technology, from using biodiesel in airport shuttle buses to dedicating $25 million to establish the Enterprise Rent-A-Car Institute for Renewable Fuels at one of the nation's leading research institutes, the Donald Danforth Plant Science Center.

In addition, Enterprise is taking steps to operate its business more sustainably -- from cutting energy use and related costs by 20 percent each over the next five years, saving an anticipated $50 million; to integrating renewable energy sources in its operations; to investing $150 million in sustainable construction.

Taylor insisted Enterprise will purchase EVs with or without government incentives. He said their customers want them and their workers are excited by the new technology.

“It is our family's philosophy that, regardless of what the tax incentives are at this point, that this is coming, it should come and we should help it,” Taylor said. "If we don't make money on these for some years, fine. Eventually, we'll make money.” As the leader of a family-owned, privately-held company, he can afford to think long term. “We don’t have to worry about quarter to quarter.”

Smith, a U.S. Marine Corps veteran who served two tours of duty in Vietnam, is grimly serious in relating the EV to national security. Our dependence on oil imports is “one of the greatest dangers this country faces ... We’re still hostage to the vast majority of oil reserves owned by national oil companies, many of which are owned by governments that are antagonistic to our interests,” he said. “By contrast, there’s more than enough spare electricity generating capacity in the U.S. to power many millions of electric cars.”

FedEx reportedly burns about 1.5 billion gallons of fossil fuels a year in company trucks and planes. Revenues last year were about $35 billion, so fuel costs ad up and they have a vivid memory of 1973. “We were almost killed in the cradle by the Arab oil embargo.”

Smith is strongly in favor of domestic oil and gas drilling, but said electric vehicles can play a big part in reducing oil imports and more importantly are fun to drive.

“If you get into a Leaf or Volt, these are wonderful cars. They are terrific in every respect. They aren’t golf carts,” he said. Not only that, but as we reported on TorqueNews yesterday, electric cars are much cheaper to power.

Battery prices have to come down to make EVs competitive with conventional vehicles, but he predicts they will drop by as much as 40 percent over the next five years.

Taylor and Smith believe the government needs to stimulate the growth of electric cars, by building the EV charging infrastructure. The government is already providing tax credits up to $7,500 to EV buyers and loans to battery makers like Ener1. Though a political conservative, Smith said the costs of electrifying the fleet, compared to the benefits, are “a pittance.”

I think this would be a great opportunity for someone to test drive the Nissan Leaf if they have an interest but aren't one hundred percent sure yet; it's much more fun to do so on an extended basis without a sales person there, just to test it out and get a good feel for it. EV's and hybrids are definitely the wave of the future.