Revolv’s Mythbusters Series dives into common misconceptions around electric vehicles, offering factual insights to aid fleet owners and operators and help them get the most out of the EV transition.
The Myth: Deploying EVs in my fleet requires a steep upfront investment
As fleet owners race to convert their ICE vehicles to EVs amid accelerated timelines, we understandably see companies struggle with the decision to invest in electric vehicles – and the other necessary components such as charging infrastructure. Fleet owners today are left to figure out if they should A) pay for everything upfront or B) leverage a company like Revolv that offers a fleet-as-a-service model – providing EVs, charging infrastructure, project planning, and more – for a flat monthly fee.
For many fleets, avoiding these large capital expenditures with the help of a full-service partner can make the most financial sense – and can come with other tangible benefits. Even if companies may have the capital to purchase EVs, funds are often better put to use for core business activities, such as hiring new talent and expanding their operations. The fleet-as-a-service model allows companies to pursue electrification without any upfront capital.
Either way, fleets today can struggle to look past the upfront costs of transitioning to EVs. The reality is that fleet users don’t need large sums of money upfront to get started on electrification, and a single point of contact provider can help with cash flow management – here’s how.
The AWS of EVs
We understand that breaking down all of the associated costs of transitioning fleets to EVs can be confusing and overwhelming. It is helpful to think of Amazon Web Services (AWS) in the early 2000s. Back in the late 80s and early 90s, businesses looking to store their data would have to purchase and dedicate an entire room of computers and servers – requiring high initial investment.
Then, AWS and other web-based services came around and upended how companies store their information. For a fixed monthly fee, companies could securely offload their data to servers at scale – without requiring the extra maintenance or investments in installing and managing dedicated space within an office building.
Revolv is doing this for the fleet world. While this service provider model doesn’t quite make sense for ICE vehicles, it’s ideal for vehicle electrification, given the complexity of the entire EV ecosystem. Now, an expert third party can manage this complicated process, enabling businesses to focus on what they are set up to do – and saving them from steep initial investments. Let’s take a deeper look at the benefits of the fleets-as-a-service model.
The fact: Cash flow management
Let’s be clear: EVs often do have higher upfront costs than their ICE counterparts, which can be a barrier to entry for some fleets, though this is made up over time when you factor in the total cost of ownership. The fleet-as-a-service model can help all businesses accomplish their electrification goals while protecting their bottom lines because the fleet providers, like Revolv, are handling the financial risk by purchasing the vehicles, charging infrastructure, and technology products.
Having an expert full-service partner can unlock savings on operating expenses over time. As we’ve recently explored, Revolv can help fleets reach cost parity, and in some cases, find additional cost savings when electrifying. Utilization also plays a significant role in recouping initial investment, and Revolv drives increased utilization for its partners’ fleets by maximizing uptime across the entire EV ecosystem.
The fact: De-risking the electrification process
The other facet of EVs is that they vary a good deal from traditional ICE vehicles. For a business that doesn’t have the dedicated resources to vet and understand the new (and ever-changing) technologies coming into play, it can be a riskier financial investment if you don’t understand the market or if you haven’t mitigated known risks.
With new improvements always on the horizon, from battery technology to chargers to software and more, it’s understandable that fleets are hesitant to invest capital in technologies that could quickly become outdated.
However, leaning on a full-service partner like Revolv can help avoid these associated risks, which also come with greater investment down the line. Revolv manages all technology risks, from the vehicle to the charger to the utility interconnections and everything in between. With this business model, a fleet will avoid having to pay more later on for making a costly mistake.
The fact: Fixed monthly fee
For fleets – which deal with constant volatility around fuel prices and other market components – a fixed monthly fee model offers more consistency and predictability. This is opposed to an upfront payment with variable costs, which is how many fleet management companies (FMC) operate by offering fixed lease payments, but with variable expenses.
At Revolv, our pricing structure is a fixed monthly fee, so businesses know exactly how much they are going to pay each month of their agreement – allowing for budget relief by eliminating the unknown future costs of electrification. And since we’re part of the larger ecosystem, we have working relationships with vendors allowing us to leverage our buying power. Additionally, compared to a FMC lease offering, Revolv offers companies a single point of contact to manage the lease – all while eliminating variable costs for the customer.
Moreover, moving from a variable to a fixed cost structure makes things a lot easier from a budget perspective – bringing much-needed flexibility into operations.
Revolv goes above and beyond
To summarize, yes there are costs associated with the EV transition for fleets, but a full-service partner can help fleets minimize and avoid high upfront costs – all while helping customers to get the most out of their electrification journey. Leaning on a full-service partner like Revolv is an investment – but we’re equally invested in our customers.
For us at Revolv, one of our specialties lies within electric vehicles. This expertise allows our partners to focus on their core business as they seamlessly transition to EVs. We save companies time and money because we’re going to do it once and we’re going to do it right – helping businesses get the most out of their investment and proving why full-service partners are becoming a go-to solution.