SONOMA, Calif. — Mack Trucks is offering an all-in monthly subscription and pay-as-you-go mileage program for its new medium-duty electric trucks, addressing concerns about high upfront costs of acquiring the zero tailpipe-emission vehicles.
The Volvo Group subsidiary introduced its Mack Financial Services ElectriFi Subscription on Monday during a Mack MD Electric ride-and-drive for reporters at the Sonoma Raceway.
The all-in subscription offerings start at a three-year plan requiring a 1,700-mile monthly commitment. Tiered pricing per mile drops with longer contracts. A customer could renew the subscription at a lower monthly price, buy the truck, or walk away at the end of the contract, said George Fotopoulos, Mack vice president of electromobility.
“The capital investment, as we know, is quite high for an electric vehicle,” he said. “This takes that hurdle out of the equation.”
Total cost of ownership parity with a diesel MD comes at about three years driving 30,000 miles a year. ElectriFi includes the truck chassis and body, alternating current (AC) chargers, annual maintenance and physical damage — but not liability — insurance.
About 70% of MD Electric trucks likely will be upfit as dry or refrigerated box trucks. Stake and dump trucks and tankers are other possibilities.
Mack enters the truck-as-a-service business
The program effectively puts Mack into the truck-as-a-service (TaaS) business. Mack hopes the flexibility will attract business for its Class 6 and 7 electric trucks introduced in March. They go on sale this quarter. Mack won’t discuss how many orders it has but build slots are available into 2024.
Mack shares its parent’s commitment for 35% of the trucks it sells to be electric by 2030. That’s a tall order for the nascent industry selling small numbers of electrics today. The MD introduced as a diesel in 2020 is Mack’s second battery-powered truck. The Class 8 Mack LR Electric refuse truck went on sale in December 2021 after a couple years of testing.
Regulations, notably in California and other states adopting its tough stance aimed at eliminating internal combustion-power trucks in the next two decades, drive creative approaches like TaaS. Multiple startups offer subscription services that include charging. Mack welcomes them.
“Anybody can become a customer of this business model,” Fotopoulos said.
Addressing fleet concerns about electric trucks
Even more than cost, fleets question whether an electric vehicle can do the job as well as a diesel. And they worry about the availability of charging infrastructure.
Including AC charging in the ElectrFi program removes that concern because it allows overnight charging with little infrastructure expense. Faster direct current charging is available but it costs more.
“Putting copper under the ground can be quite expensive,” Fotopoulos said.
Mack Financial Services offers ElectriFi Infrastructure and ElectriFi Lease including advice on incentives. Mack and its third-party partners help customers develop charging station design, installation, construction, hardware and software needed. All-inclusive financing is available, including up to a 60-month loan if Mack Financial funds the trucks.
On the service side, the five-year comprehensive Mack Ultra Service Contract provides bumper-to-bumper service for the MD and LR Electric. The contract includes telematics with battery monitoring; a high-voltage battery performance guarantee; and all scheduled and preventative maintenance.
“ElectriFi Subscription, the other financing options and the Mack Ultra Service Contract were designed to help remove any hesitancy about financing, service and support that customers might experience as they electrify their fleets,” Fotopoulos said in a news release.
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