Wednesday, October 9, 2013

The Cost Conundrum

Looking at the big picture of investing in alternative fuels, the cost to beverage distributors will vary widely, but it can be very worthwhile.

Beverage companies need to consider a host of factors, including: how long they run their trucks, driver acceptance, how big their fleets are, how long they keep their vehicles, how many miles they put on them, the sizes in their vehicle fleet, whether they travel any long distances or just do local deliveries, the cost of infrastructure, the up-charge for alternative fuel vehicles, the cost of the fuels, what kind of fuel, creating an environment image in the community, the possibility of leasing, and how to handle maintenance.

It’s a major calculation that for most largely comes down to the cost of getting in vs. the savings from fuel costs. “The total investment is probably five-fold, not only the vehicle and the infrastructure, but the fuel, the maintenance of the vehicles, the maintenance and operation of the infrastructure, and then some of the soft intangibles like driver acceptance, mechanic acceptance, and that type of issue,” says Tucker Perkins, chief business development officer, Propane Education & Research Council. “With propane autogas, you have a competitive advantage in nearly every one of those areas.” Read more here.

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