Lately, I’ve been hearing a recurring sentiment from clients: “Why should I decarbonize my fleet now?” or “Our organization’s carbon reductions goals aren’t until 2040; there’s no need to worry – that’s so far away.”
As advisors, it’s important to recognize that our clients – no matter how sustainability-focused they are as individuals – must work with stakeholders who may be anxious about shifting their operations. Investors and executives need confirmation that fleet electrification makes financial sense, while fleet and facility managers want operations to be maintained with as few disruptions as possible. Add drivers to the equation, who remain skeptical about the technology, and we soon realize how many moving parts there are to electrifying your fleet.
Today, we’ll focus on the investors and executives.
Helping clients build a business case for fleet electrification is part of our job. Here are some key talking points to help move the conversation forward:
1. Start Now or Get Left Behind
Companies that don’t innovate will stagnate. They can easily be replaced by competitors that are ready and willing to change with the times. Let’s not forget the bygone era of Blockbuster, a hugely successful company that lost out to Netflix. Similarly, transportation electrification is coming. Clients who are not yet ready to commit to fleet electrification should at least pilot electric vehicles as a way to take advantage of learning opportunities and incentives. Legislation is pushing for it, while major car brands are rolling out new electric vehicles every year.
Legislation Highlight: On August 25, 2022, the CA Air Resource Board (CARB) approved the Advanced Clean Cars II rule, which would apply to all light-duty passenger cars, trucks, and SUVs starting in 2026 and would decrease allowable emissions for new vehicles until 100% zero emissions are reached in 2035.
Auto Manufacturers Highlight: This year, electric vehicles sales are predicted to come in at over 1.1 million vehicles, with over 40 new electric vehicle models released and/or announced in 2023.
2. Align with your Mission Statement
Studies show that 61% of employees don’t know their company’s mission statement. Employees can’t live by creeds they don’t know. Unfortunately, putting time into rectifying this and fostering a culture that lives its mission statement isn’t something that we can do alone. But we can recenter that mission statement in the conversation and relate transportation electrification back to it.
3. “Have to” vs. “Want to”
Many employees are not included in strategizing and decision making, which often makes these changes feel like a chore because they are not bought in. It’s important to remember that each person on a team has their own opinions, goals, and vision for the company. Aligning fleet electrification with your mission statement is a good place to start, but we’re golden once we get people excited about the technology.
4. Think about Sustainability
Reports show that 96% of the Global 250 (G250) report on their sustainability and carbon emissions reduction goals. While there are different frameworks for setting these goals, the Science Based Target initiative (SBTi) remains the most popular. This framework shows organizations how much and how quickly they need to reduce their greenhouse gas (GHG) emissions to prevent the worst effects of climate change. Under this guidance, a company must reduce 90% of their carbon emissions by 2050. Fleet operations cannot remain the same if this target is to be met.
While most executives respond strongly to timing and deadlines, they still need the metrics to support it. Quantifying the risks and opportunities that fleet electrification represents is one of the things that sets us apart as advisors.
The next time one of your stakeholders asks why they should consider fleet electrification now, remind them that you’re not asking them to commit to full electrification. Reelevate their mission statement and commitments to help drive their enthusiasm. Piloting electric vehicles should be fun more than anything else, and trying new technologies just means dipping a toe in the water. Implementing this critical step now will help avoid obstacles going forward.
Our team at Edison Energy helps navigate the entire fleet electrification process – from buy-in to all-in – to create a plan that works for your entire organization.
Let us meet you where you are in your Transportation Electrification journey. Click here to learn more about our Transportation expertise.