Episode 203: Electric Vehicles or EVs are the way of the future. But it is a big change for commercial fleets with many question marks around performance, maintenance, repairs, and total cost of operation. How can commercial fleets adopt EVs with confidence?
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Episode 203: Electric Vehicles or EVs are the way of the future. But it is a big change for commercial fleets with many question marks around performance, maintenance, repairs, and total cost of operation. How can commercial fleets adopt EVs with confidence?
Show Notes: Visit HeavyDutyPartsReport.com for complete show notes of this episode and to subscribe to all our content.
Disclaimer: This content and description may contain affiliate links, which means that if you click on one of the product links, The Heavy-Duty Parts Report may receive a small commission.
Sponsors of this Episode:
Special Offer:
Sign up for our weekly email so you never miss out on an episode: Follow the Show
Jamie Irvine: (00:01)
You're listening to The Heavy-Duty Parts Report. I'm your host, Jamie Irvine. And this is the show where you get expert advice about heavy-duty parts that keeps trucks and trailers on the road longer while lowering cost-per-mile.
Jamie Irvine: (00:16)
Electric vehicles and EVs are the way of the future, but it's a big change for the commercial vehicle and the trucking industry. And there's definitely some question marks around things like performance, maintenance, repairs, total cost of operation. So how can commercial vehicle fleets adopt EVs with confidence? Well, I've got just the man to talk to us about that. My guest today is Dan Williams. He's the CEO of Amerit Fleet Solutions. And Dan, before founding Amerit had a real background in growing companies very rapidly twice. He's been on the 100 Fastest Growing Companies list. So he knows how to scale and grow a company. He's applying all that he's learned in those previous companies with Amerit Fleet Solutions and turning his attention to the changing technology that is electric vehicles and EVs. Dan, welcome to The Heavy-Duty Parts Report. So glad to have you here.
Dan Williams: (01:15)
Thanks for having me glad to be here.
Jamie Irvine: (01:17)
Well, I'm excited to talk to you because I think that it's a very important subject. Getting fleets to adopt EVs with confidence is a big subject right now. Obviously technology is rapidly changing. There's a lot of reasons for that and helping fleets and keeping the trucking industry going is of top priority. So let's start off by talking about some of the fears that commercial fleet operators might have. What are the fears that they have around adding EVs to their fleet today?
Dan Williams: (01:44)
I think that we can probably categorize them into three groups. So the first I think are fears around the EV units themselves. Are they gonna work? Are they gonna be economical? Am I gonna be able to get enough of them in, in the timeline that I want? And so I think that one of the things that fleets are doing right now is they're doing a lot of pilots and they're using EV units in certain use cases because that's really where the rubber hits the road. And so they're trying to understand how will these units perform in different environments and there's concerns about whether they will. I think the second area of concern is around the charging infrastructure. Of course, we all know that that's gonna be a bottleneck. I think as we're digging into the details, we're finding that there are certain use cases, you know, in the heavy-duty world.
Dan Williams: (02:27)
There's some assets that are only down a couple hours a day, which means you only have a couple hours a day to actually charge them, which takes the challenges around infrastructure and makes them even larger. So there's, there's a lot of concern there. And then the last area I would say is, which is the area that we think that we can be a part of is the infrastructure where, you know, think of training, but also think of maintenance infrastructure. And when these units break, will we have the infrastructure necessary to get them back on the road.
Jamie Irvine: (02:55)
Right, and there's a difference between fear and a barrier. Sometimes we just have fears about things because it's the unknown and we're uncertain about it. And then there's like the actual barriers. So can you talk to us a little bit about some of those barriers that are legitimate and that perhaps are slowing down the adoption to some degree.
Dan Williams: (03:16)
You know, in the media term I think production capacity of the OEMs is certainly slowing, slowing us down. That's going to be addressed in the coming 12- 24 months. I think grid the grid and charging infrastructure is another real barrier that people are facing today. I think the other thing that folks are starting to think about is the batteries and the infrastructure around the manufacturer batteries, the raw materials associated with that. There isn't a lot of domestic manufacturing capability. A lot of that is with other countries, which creates all kinds of challenges and risks. So I think that that's gonna be one that we're gonna be seeing in the coming months.
Jamie Irvine: (03:50)
Right. And some of the conversations I've had with fleets, they've got a real concern also around their technicians and their maintenance people. This is like, yeah, okay, it's a truck and it's got wheels and everything, but it is built very differently. And so there's gotta be some barriers there where they're saying, look, we already are short on technicians. We're short on drivers. There's gonna be a training curve here. And that's gotta be one of the factors as well. Is that something you've found?
Dan Williams: (04:17)
Oh yeah, for sure. Hiring good technicians, retaining them, training them, that's a challenge today. And right now there's, there's far more demand than there is supply. So when you bring in something new, something that requires new training, that requires new infrastructure, new equipment, that just makes those challenges even even worse. And that's certainly something the fleets are worried about. You know, how we're trying to address that is a program that we we're calling EV ready. So, you know, Amerit has 1600 technicians today where in all major markets and we're also working, you know, our primary customers are very large fleets. So they're also going to be early adopters of EV. And so what we're doing is we're working with OEMs, we're working with our customers, we're getting our technicians trained so that we are ready. When our customers begin receiving the pilot units begin receiving EV units. We wanna be able to support them in that journey.
Jamie Irvine: (05:09)
So let me ask you something with some of those fleets, they've got their own repair facilities, they employ their own technicians. Have you found that some of those fleets are saying, Hey, look, we're gonna keep taking care of the stuff we know, and we'll bring Amerit in to help us with this new program. And just kind of like, see how it goes. Has that been one of the situations you've seen?
Dan Williams: (05:27)
That's one of the situations, although I think the more common situation is where the customers are looking for a single provider that can be able to maintain both their ice as well as EV units. And so that's, that's really more so where we're focusing, we're making sure that we've got technicians that can handle both types of assets, as well as the infrastructure and the tooling that can handle, because at the end of the day, most of the work is being done on site, on off hours with our customers. And so getting to the facility is part of the economics. And so when we're there, we want to be able to do as much work as possible. And that's the way to make the technicians as efficient as possible.
Jamie Irvine: (06:07)
I can see a situation like, today I'm wearing A Thank a Trucker t-shirt and it says if you're wearing it, eating it or drinking it, you know, it probably was brought on a truck. So thank a trucker to me. What I think when you just said that is that these fleets may have made the strategic decision to say, look, we're good at what we do, which is transportation and logistics. We're gonna bring in Amerit because that's what they're good at. And that allows us to just focus is that those are the kind of clients that you work with.
Dan Williams: (06:35)
Absolutely. I mean, I said already that that hiring and training and retaining technicians is very challenging. And so that is all we do. And so we're very focused on it and we think that we do it, we do it well, but it's still a challenge. And so what we typically see is that customers wanna focus on their core business. They wanna focus their attention in other areas and they let us work work with the technicians.
Jamie Irvine: (06:58)
There must have been a point in time a few years ago where you said, look, this is gonna be a strategic objective for our company. We're gonna focus on EV cuz it's not like you can just turn a switch and have all of your 1600 technicians ready to go all at once. So like when did you make that decision? Tell us a bit of that story.
Dan Williams: (07:17)
Yeah. So I mean, certainly we like the industry have been talking about it, have been thinking about it now for a couple of years. And I think what we are seeing, I think like many are seeing is that the pace of adoption is speeding up. And so we've been, we've been reacting accordingly. So I would say that really last year, early last year we started making moves, started introducing ourselves to some of the OEMs, started forming relationships, started thinking about jointly developing training materials and how are we going to train these technicians? So we're probably 12, 18 months in some cases, 24 months into those relationships,
Jamie Irvine: (07:55)
We're gonna take a quick break. We'll be right back. Don't have a heavy-duty part number and need to look up a part? Go to parts.diesellaptops.com or download the app on Apple or Android to create your free account. Looking for high-quality fuel injection for heavy-duty applications? Having one supplier for fuel injection allows you to better serve customers by providing them with a complete line, which increases your sales and profitability. Learn more at ambacinternational.com/aftermarket. We're back from our break. And before the break, we were talking about how the adoption of electric vehicles is accelerating in the trucking industry. And with that, it brings unique challenges which Amerit is putting itself strategically in place to help the trucking industry to adopt EVs with confidence. Dan, you've made some strategic partnerships with EV truck manufacturers. For instance, there's a press release about a partnership with Nicola. Why are service agreements with OEMs an important part to helping fleets adopt EVs?
Dan Williams: (08:57)
Yeah, sure. So we're in discussions with a large number of OEMs, in fact, probably close to all of them. We're really excited about those discussions. And I think when you think about the OEMs, we sort of think of them in two categories. The first is the incumbent OEMs that have established dealer networks and then the newer OEMs that do not. So for the latter, the way that we can support them is obvious. You know, they're trying to think about how are they going to build nationwide networks of maintenance providers so that they can ensure that their assets are maintained reliably and quickly, and also make sure that they can honor their warranty needs. You know, as I said, Amerit's got 1600 technicians we're in all major markets today. In many instances, we're working with customers that are either taking possessions of the assets or plant or that they're prospects of the OEM.
Dan Williams: (09:46)
So there's a lot of synergy there and it makes a lot of sense for us to be working with them, to try to support those vehicles as they come online on the OEMs that have established dealer networks. I think those conversations are a little more nuanced, but there's still a lot of opportunity. You know, I said already demand right now is far outstripping supply. And you think of that both in terms of maintenance capacity, as well as just the ability to retain or to receive units. And so the customers more than ever are demanding that when a vehicle breaks, they want it fixed quickly. And so all of us are struggling with how to do that. So when we talk to the OEMs, it isn't a conversation around either or, you know, it could be either Amerit or the dealer networks. What we're talking about is how can we augment the dealer networks? We all want the same thing. We want a customer to have confidence that when their vehicle breaks, it will be fixed quickly and safely. And so the more that we can all work together to give customers confidence in that, we're all gonna win.
Jamie Irvine: (10:44)
Yeah. Speaking of warranty, one of the things I've been curious about, like not only from the service perspective, also from the parts perspective, so you have our traditional truck manufacturers, they've got their dealer networks. We kind of understand how that traditional model works, but with some of these new manufacturers, it seems to me like they're even more interested in complete vertical integration. So how is the, the warranty work gonna be handled in those situations where they don't have the traditional model like we're used to?
Dan Williams: (11:14)
Yeah, sure. So, you know, I think that there's gonna be similarity in differences. So the similarity's gonna be whether it's ice or EV, OEMs are always gonna want to have tight control over who is providing warranty work and they wanna do that because it's good business for them. They also wanna do that because they want to know that whoever's touching their assets is trained properly to do so. And of course they should do that. That's gonna continue. I think the question then becomes, you know, today most of the people that are authorized to do that work are the dealer networks. I think that certainly, as I mentioned for the OEMs that don't have those networks, they're gonna be thinking about who is gonna be doing that work, even for the OEMs that do have established networks though, I think they're gonna be thinking about how can I give customers confidence that repairs can happen quickly and they're gonna need to do that more so to be competitive and to be the ones that the OEMs too, or the customers choose. So I think that what you're gonna see is the tools that they use, the, the providers that they authorize might start to expand.
Jamie Irvine: (12:16)
That makes a lot of sense. How concerned are you about some of the new trucks that are coming out that are EVs? Like I've seen some advertising that instead of having thousands of replacement parts, they only have like 22, do you think in the long run, we're gonna see a real decline in parts and service over time, or what's your kind of viewpoint on that?
Dan Williams: (12:36)
I think our viewpoint is probably similar to everybody else's which is we think that there is going to be a decline in the maintenance needs, but first of all, there's always gonna be maintenance required. And second of all, I think we don't really know how these units are gonna be performing in actual on the road use cases. Drivers are always gonna have driver abuse and there's always gonna be repairs that are needed. So I think we think that yes, the volume per unit of maintenance is gonna go down. But I think that there's always gonna be repair requirements.
Jamie Irvine: (13:06)
Right. And then I guess there is a difference too, like you said, where we have like an acute problem where something broke and that vehicle needs to be fixed versus the regular maintenance. So from your viewpoint, what are your thoughts on how those two different scenarios are gonna be handled?
Dan Williams: (13:20)
Similarly to the way that they're handled today. You know, I think that customers are ultimately focused on uptime and they're very focused on making sure that when they make a vehicle available, either because they had no choice because they're broke or because they've made it available for a PM, they want the service provider to respond quickly and get that unit back on the road quickly. And so you know, ice, EV I don't really see that, that requirement changing
Jamie Irvine: (13:46)
When I think about the whole situation and how, you know, yes, technology is gonna change things, but there's also a couple like factors with, with humans that are at play here. For example, we already have a huge shortage of drivers. So maybe autonomous vehicles will help solve a problem. We already have a shortage of technicians and it's not like, like, you know, birth rates are declining in the west. So it's not like there's going to be an abundance of people in future generations. I think there's gonna be extreme competition for the young people coming up in every industry. So in a lot of ways, it might be that the ones who are left behind in the industry and are continuing to work in this industry are just fine because technology helps solve some of these big issues that we're facing on shortages.
Dan Williams: (14:28)
Sure. There is real training that is needed to be able to support EV units. There's real infrastructure. We're making investments in some of our infrastructure today to be able to support the units. So I think that, that what you may also find is that there are some small garages out there that, you know, they've started to be toying with the idea of retirement and they are faced with, do I make this investment to keep going, or do I maybe use this time to stop? And so I think that you are gonna start to see that some of the supply is gonna be a little constrained. I think that's probably gonna go along with the dynamics of reduced demand.
Jamie Irvine: (15:00)
So we like to sometimes focus on what's gonna change cuz we're, you know, we all have some natural concerns and fears because of the unknown. From your perspective, what's gonna stay the same that we can count on moving forward?
Dan Williams: (15:15)
A lot's gonna change for sure. But, but you know how we think about it is as long as there are assets, those assets are going to break and when they break customers are gonna want them to be fixed. They're gonna want them to be fixed quickly. They're gonna want them to be fixed with professionals and they're gonna wanna know most importantly, that those assets, when, when fixed are safe to be on the road. That's never gonna change. And so we see, you know, the fundamentals of providing maintenance, providing it on a nationwide scale, providing it to large fleets. We think that those fundamentals are going to stay the same. And you know, we're excited to be, to be a part of what's going on. Our customers are doing really amazing things. We're excited to be partners with the OEMs. We're excited to be part of this change. So I think for us as a company, we look to the future. We feel a lot of hope and you know, in today's world, that that feels pretty good.
Jamie Irvine: (16:09)
You've been listening to The Heavy-Duty Parts Report. I'm your host, Jamie Irvine. And we've been speaking with Dan Williams, the CEO at Amerit Fleet Solutions. To learn more about their company, visit ameritfleetsolutions.com. Links will be in the show notes. Dan, thank you so much for coming on The Heavy-Duty Parts Report and sharing your story and your experience and also giving us a window into the world of EVs. I really appreciate you being on the show.
Dan Williams: (16:33)
You bet. Likewise. Thanks for having me.