Greener Fleets Hit the Streets: The State of Green Business 2010

Editor's Note: To celebrate the launch of the third annual State of Green Business report, we will be highlighting over the next two weeks the 10 big trends that are shaping the future of the greening of mainstream business. You can download the report for free here, and read all 10 trends on GreenBiz.com.

While individual car buyers stayed out of showrooms, pushing the world's automakers to the brink and beyond, corporate and institutional buyers proved a bright spot for the industry -- a bright green spot, in fact. Fleet buyers ramped up their purchases of hybrid-electric, diesel, biodiesel, electric and other so-called alternative-fueled vehicles, from taxis to trucks. These buyers continued leadership role will be critical to electric-vehicle manufacturers' hopes of growing sales and lowering costs.

The company announcements arrived in bumper-to-bumper fashion: Coca-Cola Enterprises' hybrid-electric diesel delivery fleet would be the largest in North America. An all-hybrid taxi company in Phoenix, Arizona, joined similar fleets from San Francisco to Boston. Frito-Lay added 1,200 fuel-efficient Sprinter delivery vehicles to its fleet; they get 50 percent better fuel economy than conventional vehicles in the firm's fleet. And many others, from AT&T to Zipcar.

And then there were the package delivery folks, each of which is trying to lap the others in a race to be seen as the green leader. UPS has been focusing on its truck fleets for some time, and now boasts more than 1,800 alternative-fuel vehicles globally, including hydraulic, hybrid-electric delivery trucks. The U.S. government's Recovery Act helped the U.S. Postal Service swap 6,500 old vehicles with a mix of hybrids, flex-fuel and four-cylinder replacements. The one-for-one vehicle replacement, which cost USPS nothing, includes 900 hybrid, 1,000 flex-fuel and 4,600 four-cylinder vehicles. And FedEx increased its North America hybrid truck fleet by 50 percent, adding 92 additional retrofitted delivery trucks, which produce 96 percent fewer particulates and 75 percent fewer smog-causing emissions than standard delivery trucks.

Green vehicles are getting traction for a number of reasons. For one, they are helping large fleet owners meet their companies' greenhouse gas reduction goals; for some companies, fleets are among the biggest parts of their carbon footprint. Fleet management companies, to which big companies contract to purchase, maintain and operate large vehicle fleets, are using their buying power to bring down the price premiums of some green vehicles. And it's not just about what you drive, but how you drive it, that's making vehicles more efficient. For example, PHH Arval, one of the largest fleet managers in the U.S., began a GreenFleet program, which encompasses smart vehicle selection, driver education and better maintenance to help companies cut their fleet operating costs by an average of 7 percent a year.
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Technology is helping, too. Telematics, for example, can be used to help customers trim service time, while hybridization will allow them to reduce their fleet greenhouse gas emissions and related fossil fuel use. Fuel selection is another opportunity for savings. And when you put them altogether, the savings can compound. Novo Nordisk, Poland Spring and Carrier are among companies demonstrating that driving less, selecting more efficient vehicles and choosing lower-carbon fuel sources are bedrock principles of greenhouse gas management. For example, Novo Nordisk was among the first major fleets to train its drivers on fuel-smart driving practices, such as avoiding aggressive driving and minimizing idling. This effort alone helped Novo Nordisk increase the fuel efficiency of its existing vehicle stock by nearly 3 percent.

Tomorrow: Energy Efficiency Gains Horsepower