Large, medium-duty electric trucks are available to fleets in the United States, and most of them have been deployed over the last five years by seven different manufacturers. However, now that arguably the most prominent and market-leading electric truck maker, Smith Electric Vehicles, has suspendedproduction, what is the state of this market?
The news about Smith is certainly a strike against the electric truck movement, but as reported by the Kansas City Business Journal, Smith CEO Bryan Hansel is optimistic that his company will reopen its Missouri factory as early as this summer. Moreover, he notes that the factory will be retooled for better production and supply and expects the improvements to ensure profitability for Smith. Hansel’s clarification does boost confidence in Smith’s ability to rebound, although his words should also come with some skepticism. After all, Smith heavily publicized an initial public offering that never came to fruition back in 2012, plans to build a factory in Chicago that never progressed, and an order for 100 electric school buses that went unfulfilled, among other claims.
In New York, one of those other claims was the announcement back in 2011 that Smith would open a factory in the Bronx. Despite featuring Smith and its anticipated Bronx factory in those “New NewYork” television commercials narrated by Robert De Niro, the factory still has not come. However, Smith’s electric trucks do have a presence in New York and have been operated by local companiessuch as Down East Seafood and Duane Reade as well as large, international companies such as Frito Lay (PepsiCo) and Coca Cola. In New York and nationally, though, demand for electric trucks is slim, and Smith has only made 439 sales in the United States.
The challenges facing the electric truck market are essentially the same as those facing electric cars. The vehicles themselves are very expensive, the range of their batteries is limited, and the technology is new and unfamiliar. Those challenges are even more difficult for electric truck makers to overcome, since the manufacturers are startups and small companies like Smith.
However, there is also great opportunity in the market. Last year, Georgia Tech conducted a comprehensive study on the emissions and cost savings of electric trucks, concluding that in dense, urban areas, their total cost of ownership is roughly 20 percent cheaper than diesel counterparts. Much of this savings comes from reduced fuel consumption and maintenance needs. If one assumes that these trucks are leased and operated for a typical length of 5 years, that 20 percent savings should amount to a return on investment of about four years, which is not so bad. As the cost of lithium-ion batteries falls and as electric truck manufacturers gain experience, streamline their operations, and reduce costs, the price of electric trucks is sure to come down. As these prices approach those of diesel trucks, operational savings will drive a more and more compelling return on investment for electric trucks and greater demand from fleets.
The opportunities do not end with reduced vehicle prices though. DC fast charging, for starters, allows electric trucks to spend less time charging their batteries and more time working for a fleet, and improved energy density in batteries will boost their range. In fact, CleanTechnica recentlyreported on how Volkswagen is developing a battery that holds three to four times more energy thanthose on the market today. Even vehicle-to-grid (V2G) technology, which allows an electric vehicle to send electricity back into the energy grid when hooked up to a charger, is being tested on electric trucks made by Boulder Electric Vehicle. V2G alone will earn fleets money by allowing them to charge with electricity from the grid at low-cost, off-peak hours, and then sell it back to a utility at a higher price during peak hours. These technologies all address the shortcomings of electric trucks and are not science fiction. They are all either being used and tested or are under development.
Ultimately, several companies besides Smith are seeing the opportunities in the electric truck space. Some known manufacturers currently include AMP Electric Vehicles (Workhorse), BalqonCorporation, Boulder Electric Vehicle, Electric Vehicles International, and ZeroTruck. Whether or not these companies begin seeing higher demand for their electric trucks is unknown, but considering the great opportunities and technological improvements on the horizon, it is very plausible that theirmarket will grow.