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Tuesday / 12 November 2024
HomeNewsVolvo launches first-of-its-kind rental service in South Africa

Volvo launches first-of-its-kind rental service in South Africa

Volvo has become the first company in South Africa to offer fully-electric trucks in its rental fleet.

The subsidiary has consistently been importing electric trucks to the domestic market since 2023 for homologation purposes and to determine which configurations its local customers require most.

Its current product portfolio consists of FH, FM, and FMX models, configured as 4×2, 6×2, and 6×4 tractors, and it will soon add FM 4×2 and 6×2 rigids to the catalogue.

“We recognise that the high initial capital cost of electric vehicles makes them harder for customers to bring into their business, especially those that have shorter-term contracts with their customers,” said Eric Parry, Senior Manager of Sustainable Solutions at Volvo Trucks South Africa.

“The intention [with the rental service] is to bring down the ‘barrier to entry’ for those with the environmental ambition to move to cleaner transport solutions.”

A new market gap

Volvo saw the potential of introducing the Equipment-as-a-Service (EaaS) model for electric trucks in the country in light of the high demand for diesel truck rentals, explained Paul Uys, Managing Director of Volvo Financial Services Southern Africa.

“The biggest advantage of vehicle rental is there is reduced capital outlay compared to when you purchase a truck,” he said.

“The rental option also allows you more flexibility in using the vehicle for a shorter period, without the commitment attached to a long lease obligation.”

With each client, Volvo enters a customised and detailed agreement that is dependent on the vehicle and the type of operations in which it will be used.

All rental units incorporate Volvo Connect, allowing customers access to a range of fleet management solutions like vehicle tracking.

“At this stage a ‘rent-to-own’ option is not available, but customers can finance electric trucks with ultimate ownership then subsequently passing to them,” said Uys.

Volvo Trucks’ EaaS rentals are available countrywide and the company has partnered with an established service provider to offer customers the necessary charging infrastructure across the nation, thus addressing the need for an easily accessible charging network.

“We run detailed simulations for each route that a fleet would like to operate an electric truck in, and this allows us to determine the optimal location and size of the charger. Our trucks can take up to a 250kW DC fast charger,” said Parry.

“Then, depending on the client’s needs, we will be able to do a site survey and recommend the optimal charger installation for their location. Our supplier will be able to rent the charger to the client for the period of the vehicle rental.”

The rental period starts at six months but can be extended, and the rental amount includes the maintenance and insurance cost of the particular truck.

Volvo has three dealers in South Africa’s major metros with trained technicians and special tools ready to support the fully-electric vehicles, which it says will only have to come in once a year for a service regardless of the mileage they rack up.

Special driver training is also available to educate drivers on how to get the best out of a battery-powered truck, however, the control, couplings, and driving style are identical to a diesel model, so not too much functional training is needed.

Parry said the company has already received interest in its electric truck rentals from a range of businesses, including big blue chip corporates as well as smaller fleets.

“Volvo’s Trucks Electric Trucks are aimed at customer fleets with a strong environmental ambition or a push from their client base,” said the manager.

“The rental option enables them to test out the product in their operation for a meaningful amount of time, without the initial capital investment.”

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