The Feasibility of Adding Alternative Fuel Vehicles to the Fleet

Adding Alternative Fuel Vehicles to Lotus Rental Car

In an effort to bring down the gasoline cost for his fleet, Lotus Car's Chief Financial Officer is looking at the possibility of adding alternative fuel vehicles to its fleet. To make a sound decision, she decided to hire a consultant firm that would review and determine if implementing the addition of alternative vehicles would benefit the company.

By performing thorough research, the consultants will first perform a comparison between gas vehicles and alternative fuel vehicles. The consultant will then determine the advantages and disadvantages of adding alternative vehicles to Lotus Rental Car Company.

Before the decision is made to add alternative-fuel vehicles to the Lotus fleet, we need to determine if AFVs truly are a feasible option. We must first acquire an understanding of alternative-fuel vehicles. As discovered in our research, there are currently a wide variety of alternative-fuel vehicles being used today. Alternative-fuel vehicles can operate on fuels other than gasoline or diesel. They come in a variety of forms, from commuter cars to large 18-wheelers. Using alternative fuels helps reduce our nation's dependence on imported oil and improves air quality. The Energy Policy Act of 1992 (EPAct) defines alternative fuels as electricity, ethanol, natural gas, propane, methanol, hydrogen, and biodiesel (U.S. Department of Energy, What is the Energy Policy Act of 1992, para. 2).

Gas prices all over the world have been elevated for years, giving drivers no other option than to pay the high costs of gasoline with more people driving vehicles that require more gas on a weekly basis (Hybrids gas up less often, n.d).

By the end of 1993, about 275,000 Alternative Fuel Vehicles were running on American roads. These were nearly all federal or private fleet vehicles, not really publicized and were scarcely available to the public. Although these numbers were a major figure in that year, the projection of Alternative Fuel Vehicles due to its popularity growth and the awareness of the health benefits, it is estimated that there will be 2.5 million Alternative Fuel Vehicles on the nation's highways by 2010. After explaining the benefits of using Alternative Fuel Vehicles, in 1993, former President Bill Clinton required that 75% of the vehicles acquired by the federal fleet be Alternative Fuel Vehicles by the year 1999.

Alternative Fuel Vehicles run on a combination of gasoline and ethanol fuel. Alternative fuels include ethanol, methanol, natural gas, liquefied petroleum gas, hydrogen, electricity, and any other fuel or energy source that is not produced from petroleum. The standard gas car only uses a maximum of 10% ethanol, as oppose to an Alternative Fuel Vehicles are environmental and less pollutant than a gas-powered vehicle and can reduce our dependency of foreign oil.

Alternative fuels are inherently cleaner than gasoline because they are chemically less complex than gasoline and when burned, they burn "cleaner" with fewer ozone forming emissions. Therefore, not only do Alternative Fuel Vehicles use lesser energy and more natural resources, the fuel itself also contributes to a safer and healthier environment, eliminating some of the health issues that come along with gas-powered vehicles.

There are a few facts and statistics on Alternative Fuel Vehicles versus gas vehicles. The first fact is that Alternative Fuel Vehicles can lead to considerable health benefits from lower air emissions, as oppose to gas vehicles, which causes two-thirds of air pollution. Another fact, in regards to an electric car, is that the electric car only have one moving part, whereas, the gas vehicle has hundreds of moving parts. In addition, probably the most important statistic pertaining to driving is that Alternative Fuel Vehicles increase fuel efficiency by 20-50%, in comparison to the reduction driving range of 50% by the gas vehicle. Going forth into the future, Alternative Fuel Vehicles seem to be both the short and long term goals for solving the lack of resources available by creating its own resource, being less dependent of foreign oils, and eliminating the health issues that were created from the gas powered vehicles. Who knows, maybe in 10 years, we could actually look into the sky and see a brighter day.

Hybrid vehicles are striking the scene in a positive way. They are becoming the choice vehicle for many buyers. Hybrids are fashionable in both style and status. With more consumers being focused on the ongoing problem of air pollution, it is not a surprise they are drawn to hybrid vehicle models (Why Hybrids are the vehicles of choice these days, n.d). Hybrids are easier on the environment as well as one's wallet. The fact that they are designed to be kind to the environment is getting the attention of many consumers, businesses and governments.

The hybrid car is something of mixed origin or composition by definition. A hybrid vehicle is one that functions with the use of both gasoline engine and electric engine. The gasoline engine is smaller than conventional vehicles, allowing the electric motor to compensate with energy. A high-voltage battery charges the electric motor when the car is parked. The hybrid vehicles can be operated using either of the engines or both at the same time. Therefore, it uses less gas. Hybrids also offer a quiet ride.

Many people purchased hybrid cars to save money from the increasingly high price of gasoline. As the cost of gas increases so does the demand on hybrid vehicles. Although many people would like to purchase hybrid vehicles because of their efficiency, many people are being added to a waiting list because of the high demand. Most people will wait an average of six months in order to buy hybrid vehicles and their prices vary from dealer to dealer.

There are many reasons to buy a hybrid car. Hybrid cars are typically smaller and have engines that are more efficient. Hybrid vehicles also have regenerative braking. This means that the electric motor that drives the hybrid acts as a generator and charges the battery while the car is slowing (top five reasons to buy a hybrid, n.d). Hybrids also have a periodic engine shut off; meaning when a hybrid is stopped in traffic, the engine is temporarily shut off. Then when the car is put back in gear, the car starts automatically. The efficiency of the hybrid outperforms that of a conventional car.

The government is creating incentives as tax breaks for owners of hybrid vehicles, which includes a $3,400 tax credit on their individual tax returns. The bill passed by the president focuses on the environment but also on the fact that hybrids save on oil use. This directly affects the country's dependency on foreign oil (Tax incentives for hybrid owners,