FedEx Ground Joins Move Toward Propane

FedEx Ground Joins Move Toward Propane

fedex trucksFederal Express (Memphis, Tenn.), known for offering overnight package and mail delivery across the U.S. and worldwide, has among its divisions FedEx Ground, which focuses on shorter-distance small package deliveries that trucks and vans handle exclusively. For the FedEx Ground division, the parent company hires independent contractors who run the operations as their own businesses.

Jon Chase, one of those independent contractors, took advantage of Federal Express’ recent offer of incentives to help contractors pay for alternative-fuel technology in their fleets. Through his company, Chase Delivery (Lancaster, N.Y.), he oversees 30 to 35 part-time and full-time drivers who operate 22 FedEx Ground trucks around a large area of Buffalo, N.Y. He used incentives from the parent company to purchase a Ford F-59 delivery truck that runs on a Roush CleanTech (Livonia, Mich.) dedicated propane autogas fuel system to serve this high-mileage route in Buffalo.

Roush CleanTech unveiled the Chase Delivery truck at the National Truck Equipment Association (NTEA) Work Truck Show in Indianapolis in March. Chase estimates his company will save substantial costs over the lifetime of the delivery truck. In addition to UPS’ announcement at the Work Truck Show that it would add 1000 propane-powered vehicles to its delivery fleet, and DHL saying two years ago that it would add propane autogas vehicles, FedEx is the latest to continue the trend of package delivery companies making a commitment to propane.

Under FedEx Ground’s reimbursement program, the company pays contractors for their fuel use and mileage according to the type of vehicle and the fuel used. As an incentive, FedEx has agreed to pay the diesel fuel reimbursement for alternative fuel vehicles. This allows Chase to pocket the difference on the savings from propane, helping to offset the cost of the truck.

Chase spoke to another FedEx Ground contractor who saw value in that incentive. While Chase went with propane autogas, partly because the F-59 vehicle he purchased could be quickly converted to a Roush CleanTech propane autogas fuel system, the other contractor went with CNG, which did not turn out to be an easy transition.

“It was not necessarily the technology, but the company they are dealing with, as well as some logistics issues,” Chase stated. “The information I got from Roush CleanTech regarding propane and its flexibility, it’s just a matter of getting the right fittings to be able to fill your trucks up and working around the price that you might like to get.” Range issues with CNG also swayed him toward propane.

The switch to propane autogas will help the delivery drivers concentrate more on the task of transporting packages. When drivers work with the windows open for most of the year, diesel exhaust fumes from their own vehicles often waft into the driver compartment. With the low-emissions propane system, the driver won’t constantly have the light-headed feeling that sometimes comes from smelling diesel all day. Also, propane autogas runs quieter than diesel, another factor that allows the driver to focus more on the job at hand.

But the cost savings of propane autogas is the main reason Chase made the switch. A press release announcing his move to propane mentioned that his business would save about $25,000 by switching that one truck alone to propane, but Chase claims that number is “pretty conservative” because it doesn’t factor in such elements as the propane engine’s reduced maintenance cost compared to a diesel engine. He expects a less than three-year return on investment, and he plans to add three more alternative fuel trucks to his fleet by year-end.

Chase, an advocate of various alternatives to diesel, hopes the exposure from the NTEA show will push more FedEx Ground contractors that are on the fence to move to alternative fuels.

Roush CleanTech has worked to expand the number of industries that use propane autogas. The move toward package delivery started through Roush CleanTech’s partnership with Ford dealerships across the country, and the FedEx Ground deal started through South Bay Ford in Hawthorne, Calif.

Todd Mouw, vice president of sales and marketing for Roush CleanTech, said Roush CleanTech built some demonstration units for South Bay Ford to allow customers to test the vehicles to see if they liked them. Green Alternative Systems (Chino, Calif.) installed the propane systems on the demonstration units.

Roush CleanTech and Federal Express have discussed expanding the use of vehicles beyond its FedEx Ground business, but Mouw could not provide details on those discussions. He sees additional uses for the F-59 beyond package delivery, however. Linen service companies and vending machine delivery companies have shown interest in the chassis.

Chase currently fuels the vehicles at Rusiniak’s, a towing company and gasoline station in Cheektowaga, N.Y. that sells propane autogas. He has spoken to Federal Express’ corporate sustainability department and hopes the department will soon allow an onsite propane filling station to be built at the FedEx Ground terminal.     —Daryl Lubinsky

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