UPS Turns to Propane in $70M Alternate-Energy Push

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March 5 (Bloomberg) -- Bloomberg chief national correspondent Carol Massar examines the $70 million investment in propane-fueled vehicles by UPS as it diversifies its delivery fleet with alternative-fuel vehicles on Bloomberg Television’s “In The Loop.”

Inside ups.

I remember that well.

You are driving the truck, delivering the packages.

Those vehicles will run on a variety of fuels.

They have been for some time.

They have electric, hybrid electric, and traditional gasoline and diesel, and they have propane.

The news today from ups is about propane specifically.

They did a test run in georgia last winter and they are announcing they will spend 70 million dollars to buy propane trucks for the united states specifically.

They had propane trucks he and canada, but they are creating a propane leak in the u.s. that will replace gasoline, diesel-fueled vehicles largely found in rural areas.

They will also be looking to expand it to other states.

Ups is also installing an additional 50 fueling stations at various locations.

What is interesting is the company says this move will displace about 3.5 million gallons of conventional gasoline and diesel per year, a definite move into propane.

Why now, carol?

I spent a lot of time with the company at various facilities, and what i find over and over again is this is a company about crunching their data.

I was at their big of in louisville, -- hub in louisville, and i was reminded that they like to crunch the data on everything they do bad -- do.

They are trying to figure out to do with a huge fleet of airplanes.

I spent time with the delivery man here in new york city.

They are looking to be efficient.

This is a big company.

They monitor everything.

They standardized even the smallest issues.

They used to have their drivers only make right turns.

It is only about not waiting at a corner.

I have also spent a lot of time on their route guidance system.

It is all about saving time and money, reducing fuel burn.

That is a big deal.

I was going to say, how big of a deal is reducing fuel costs?

It is a huge cost component.

Their global delivery fleet, it is more than 96,000. propane is more readily available, especially on rural routes.

They also talked about increased natural gas reduction making it more readily available, and you mentioned fuel costs -- fuel specifically will be cheaper.

They say about $1.25 to $1.50 less than gasoline or diesel and it gets similar mileage.

I also want to point out this is a company aware of their carbon footprint.

They have to be because of regulations and because they are concerned about it.

Feels like propane are a clean your burning out -- cleaner burner -- burning alternative.

This will give them one of the largest private propane fleets in the u.s.. thank you.

Carol massar, chief national correspondent.

Let's stay on the topic of shipping.

Shares of prologis, the developer that built logistic facilities for companies like ups, amazon, walmart -- they are up a strong 13% this year.

Internet commerce and recovering economies are driving demand and a recent dividend hike and a joint lucrative adventure has drawn attention to the company.

Where is the company building for the future and can the trend continue?

Qana, lebanon, ceo, joins me

This text has been automatically generated. It may not be 100% accurate.


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