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Jay Inc.

7500 Grant St
Fort Worth, TX 76029

Date: October 17, 2019


To: Jay Smith
Chief Executive Officer
Jay Inc.
From: Andres Zuniga, Project Manager
Delfino Mauridi, Project Materials Coordinator
Thomas Ash, Research Analyst
Subject: Progress Report for the Electric Truck Study at Jay Inc.

Purpose
The purpose of our progress report is to relay our progress towards our goal of gathering
information about the best course of action to implement electric trucks into our fleet of
vehicles.

Introduction
Currently, Jay Inc. is using too much of its budget on shipping cost each year. The
majority of our shipping and handling budget goes to the cost of fuel and maintenance
on our current fleet of all diesel trucks. With the rising cost of fuel and increase of
emission regulations, Jay Inc. will not be able to keep up with these costs in the years to
come. Currently, Jay Inc. is attempting to lower these costs by outfitting our trucks with
more technology to help fuel economy as well as providing training to our drivers on how
to drive in a more fuel efficient way. Implementing electric trucks would reduce overhead
cost and would benefit our drivers and our mechanics.

Completed Tasks
Task 1: Determine current cost to maintain and run diesel trucks

We found out that commercial/diesel trucks require much more maintenance than other
vehicles, including electric trucks. Diesel trucks require regular maintenance, factory
scheduled maintenance and inspections. The average annual cost for a commercial
truck is $70 000 and the average cost for replacing and repairing broken or worn out
parts is $30 000. Including all kinds of maintenance, the average annual cost for running
or maintaining a commercial truck is $160 000.

Task 2: Determine costs of new electric trucks

While Tesla is at the forefront of electric semi trucks, various manufacturers are
becoming involved in the electric semi truck market. A brand-new Tesla “300-mile range
[truck] will start around $150,000, while its larger sibling, a truck with a 500-mile range,
will start around $180,000(Stangel, Luke)”.

Task 3: Compare electric trucks to diesel trucks


When compared to each other, electric trucks are more expensive to buy. Electric trucks
are cheaper than diesel trucks to run per mile by 20%, but electric trucks have range
limits due to the lack of charging stations. Electric trucks also have more potential in
urban areas than diesel trucks since there are more places to charge them and they do
not produce any emissions.

Task 4: Research benefits of converting to electric trucks

Converting to electric semi trucks can benefit everyone involved. Running costs are low
and require less maintenance over the truck’s lifetime. Electric semi trucks have low
emissions, due to electric battery and no exhaust fumes. Drivers have more room due to
the lack of a real engine. Electric semis will also have lots of new technology which is
discussed in Freight Trust Journal saying, “Stepping away from traditional engine-related
engineering allows electric semis to incorporate some advanced technology for benefit
of all. For example, by nature of each wheel on the Tesla Semi having an individual
electric motor, if one breaks down, the others can continue on without a hitch
(FreightTrust Journal)”.

Task 5: Research potential tax breaks for using electric trucks

The IRS and federal government offer a number of financial incentives and tax credits
for electric vehicles. “The federal Internal Revenue Service (IRS) tax credit is for $2,500
to $7,500 per new EV purchased for use in the U.S. The size of the tax credit depends
on the size of the vehicle and its battery capacity (Office of Energy Efficiency &
Renewable Energy)”.

Task 7: Compare depreciation cost between diesel and electric trucks

A diesel truck can waste thousands of dollars in maintenance costs. Diesel trucks tend
to have engine problems if not properly maintained. Diesel trucks also tend to not have
high-speed performance, while the new electric semi trucks are going to be able to reach
high-speeds. Diesel trucks are more expensive to fix, often the cost “, of repairing,
refueling and maintaining an electric vehicle are lower. Yearly spending on those
expenses runs $35,676 for diesel truck. The electric truck would cost less than half,
$14,306(Ferris, Roberto)”.

Abandoned Task
Task 6: Interview Truck Company Owner

Task 8: Interview truck drivers

Task 6 and 8 were abandoned due to time restraints and scheduling conflicts.
Schedule

Task Completion of Task (by Date)


Task 1:
Maintenance
Cost Of Diesel
Trucks
Task 2: Cost
Of New
Electric Truck
Task 3:
Compare
Electric to
Diesel
Task 4:
Benefits of
Converting to
Electric
Task 5:
Potential Tax
Breaks
Task 6:
Interview of
Truck
Company
Owner
Task 7:
Depreciation
Cost of Trucks
Class Period 22 24 29 31 5 7
Tan –
Black –
Color Abandoned
Completed
task
Month OCTOBER NOVEMBER

Work Cited
“Electric Semi Trucks – What Do They Bring To The Table?” FreightTrust, 2 May 2019,
freighttrust.net/blog/electric-semi-trucks-explained/.

“Electric Vehicles: Tax Credits and Other Incentives.” Energy.gov,


www.energy.gov/eere/electricvehicles/electric-vehicles-tax-credits-and-other-incentives.

Ferris, Roberto. “Tesla Semi Could Save Money over Diesels within 2 Years of
Ownership.” CNBC, CNBC, 11 Jan. 2018, www.cnbc.com/2018/01/11/tesla-semi-could-
save-money-over-diesels-within-2-years-of-ownership.html.

Stangel, Luke. “Tesla Reveals Price of Semi Truck, and It’s Surprising Competitive.”
Bizjournals.com, 27 Nov. 2017, www.bizjournals.com/sanjose/news/2017/11/27/tesla-
semi-truck-price-cost-fuel-tsla.html.