GE (NYSE: GE) to Diversify Fleet with Natural Gas Vehicles

Brian Hicks

Written By Brian Hicks

Posted January 8, 2013

General Electric (NYSE: GE) announced some two years ago that it would purchase 25,000 electric vehicles for company use. But it looks like that’s going to have to wait a bit, as GE’s corporate fleet-services customers have been clamoring for broader options.

GE is now looking into natural gas-powered pickups and propane-fueled vehicles. These newer choices are part of the roughly 11,000 vehicles, largely plug-in hybrids or all-electric vehicles, that GE has purchased from Ford (NYSE: F) and General Motors (NYSE: GM).

From Bloomberg:

“Many companies say they want to think about what their reliance on oil is, but there’s a disconnect we’ve been tracking for a couple of years now” between chief executive officers’ goals and their purchasing managers’ decisions, said Scott Sarazen, global cleantech practice leader at Ernst & Young.

GE is, of course, a major name and owns around 30,000 fleet vehicles for its employees, in addition to the 1.4 million vehicles it manages for lease customers.

But what’s happening here is a gap between public statements made by leading companies, invariably forward-thinking when it comes to green technologies, and real-world demands and infrastructural concerns.

The Chevy Volt is a case in point. Back in November of 2010, GE stated that the Volt would feature prominently among 12,000 EVs that the company would buy from GM by 2015. However, the Volt hasn’t exactly performed that well.

In 2012, GM slashed global delivery goals by 42 percent to a mere 35,000. Domestic sales of the Volt in the U.S. come to a disheartening 23,461.

Fleet vehicle shifts are especially interesting because they help automakers and push broader consumer awareness. However, with the price of natural gas at $3.29 per million British thermal units (as of January 4), and batteries continuing to command high costs in EVs, it’s easy to see why GE might find diversifying an attractive option.

Right now, GE is testing out 300 Ford F-250 pickups that run on compressed natural gas and is set to purchase 2,000 C-Max Energi wagons.

Ford, for its part, will market GE’s EV charging solutions and natural gas fueling products to commercial customers. GE hopes to see the 25,000 electric and other alternative-fuel vehicles split between 10,000 spread among the company’s 65,000 fleet customers and the remainder replacing half of the company’s 30,000 corporate vehicles.

GE has also completed a two-year research deal with Nissan (TYO: 7201), wherein the latter will explore options of integrating EVs into existing power grids.

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