February 28, 2017 | Vol. 67, No. 5
Dear PEI Member:
In conversations with PEI members during the past few months, questions about electric vehicles (EVs), car-sharing and ride-sharing services continue to crop up. Part of the interest is just natural curiosity because these new transportation options are garnering so much media attention. But PEI members also are wondering what sort of impact each will have on the liquid fuel and fluid handling equipment industry.
In the near term, at least, the answer is “not much.”
Electric Vehicles. At first blush, EVs would seem to constitute the biggest threat. After all, each EV sold represents one less internal combustion-powered vehicle on the road. True enough, but the most recent projections from the Fuels Institute are that, at best, EV sales might account for 4.84 percent of all vehicle sales by 2025. And at that rate, EVs would still represent only 1.76 percent of all registered vehicles in the nation. Not exactly a “sky is falling” scenario for traditional internal combustion, fossil-fueled vehicles. It takes a very long time to transition a nation’s fleet.
Car Sharing. The developed world is moving toward a sharing economy. Want access to a vacation home, an airplane or a wedding dress for a few days or a few hours? No problem. Various services make it easy for you to enjoy any of these—as well as many other products and services—on a short-term basis. No need to buy. Pay only for the time you use the item.
Car-sharing services are a fairly recent entrant into the sharing economy. Vehicles are stationed at convenient locations throughout many metropolitan areas. Any member may submit a quick reservation, grab one of the nearby cars and pay for its use by time or by mile. All the benefits of easy mobility without the costs associated with vehicle ownership.
A 2016 study by the Boston Consulting Group predicts car sharing will grow rapidly over the next five years but have a surprisingly small impact on vehicle sales. Nevertheless, many major vehicle manufacturers are investing in or starting their own car-sharing services to offset any loss in vehicle sales with usage fees from the car-sharing drivers. This includes Daimler’s car2go, BMW’s DriveNow, General Motors’ Maven and Ford’s Smart Mobility initiative.
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The reason car sharing should have little impact on the fuel handling equipment industry? People still will drive where they need to go. Fuel still will be metered and dispensed. The equipment to facilitate both fueling and payment still must be installed, serviced and maintained—no matter who owns the vehicle.
Ride Sharing. Everything about ride sharing is designed with the customer in mind. An easy-to-use app. Convenient credit card billing. Easy expense tracking. Driver rating scales. Vehicle and driver choices. As a result, Uber, Lyft and other similar services have transformed and expanded ride-for-hire transportation in the eight years since ride sharing was born.
So important has ride sharing become that a national survey completed last month by Certify, a travel and expense management software provider, found that Uber is now the vendor most often expensed by business travelers.
As with car sharing, auto manufacturers are racing to get into the ride-sharing game, with GM’s $5 million investment in Lyft being the biggest move of all so far. But, here again, ride-share cars still need to be fueled. So, any potential negative impact on our industry is hard to see.
There’s a big lesson in all of this. The fuel and fluid handling equipment industry is a good place to be. Even in a time when multiple disruptive forces are rocking the transportation world, our little corner of that world remains strong and stable.
PRUITT CONFIRMED AS EPA
LAST DAY TO SAVE ON PEI WOMEN CONFERENCE
ASTSWMO SCHEDULES UST WORKSHOP
AUTOMAKERS SEEK TO REVERSE
The EPA was required to evaluate and finalize 2022-2025 standards by April 1, 2018. In its petition, the Alliance of Automobile Manufacturers, which represents GM, Ford, Toyota and nine other automakers, argued that the EPA’s early decision (nearly 16 months before the deadline) was "the product of egregious procedural and substantive defects" and "riddled with indefensible assumptions, inadequate analysis and a failure to engage with contrary evidence." The Association of Global Automakers, which represents the U.S. operations of Honda, Nissan and 10 other automakers, made similar arguments in its petition.
An EPA spokesperson said the agency is reviewing the requests.
SHELL ANNOUNCES EMV STATUS AND PLANS
ADMITTED TO PEI
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The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Richard C. Long, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.