February 28, 2017 | Vol. 67, No. 5

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Dear PEI Member:

In conversations with PEI members during the past few months, questions about electric vehicles (EVs), car-sharing and ride-sharing services continue to crop up. Part of the interest is just natural curiosity because these new transportation options are garnering so much media attention. But PEI members also are wondering what sort of impact each will have on the liquid fuel and fluid handling equipment industry.

In the near term, at least, the answer is “not much.”

Electric Vehicles. At first blush, EVs would seem to constitute the biggest threat. After all, each EV sold represents one less internal combustion-powered vehicle on the road. True enough, but the most recent projections from the Fuels Institute are that, at best, EV sales might account for 4.84 percent of all vehicle sales by 2025. And at that rate, EVs would still represent only 1.76 percent of all registered vehicles in the nation. Not exactly a “sky is falling” scenario for traditional internal combustion, fossil-fueled vehicles. It takes a very long time to transition a nation’s fleet.

Car Sharing. The developed world is moving toward a sharing economy. Want access to a vacation home, an airplane or a wedding dress for a few days or a few hours? No problem. Various services make it easy for you to enjoy any of these—as well as many other products and services—on a short-term basis. No need to buy. Pay only for the time you use the item.

Car-sharing services are a fairly recent entrant into the sharing economy. Vehicles are stationed at convenient locations throughout many metropolitan areas. Any member may submit a quick reservation, grab one of the nearby cars and pay for its use by time or by mile. All the benefits of easy mobility without the costs associated with vehicle ownership.

A 2016 study by the Boston Consulting Group predicts car sharing will grow rapidly over the next five years but have a surprisingly small impact on vehicle sales. Nevertheless, many major vehicle manufacturers are investing in or starting their own car-sharing services to offset any loss in vehicle sales with usage fees from the car-sharing drivers. This includes Daimler’s car2go, BMW’s DriveNow, General Motors’ Maven and Ford’s Smart Mobility initiative.

EVs, Car Sharing and Ride Sharing

PEI Women Conference Registration

ASTSWMO Workshop on USTs

Automakers Protest CAFE Standards

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The reason car sharing should have little impact on the fuel handling equipment industry? People still will drive where they need to go. Fuel still will be metered and dispensed. The equipment to facilitate both fueling and payment still must be installed, serviced and maintained—no matter who owns the vehicle.

Ride Sharing. Everything about ride sharing is designed with the customer in mind. An easy-to-use app. Convenient credit card billing. Easy expense tracking. Driver rating scales. Vehicle and driver choices. As a result, Uber, Lyft and other similar services have transformed and expanded ride-for-hire transportation in the eight years since ride sharing was born.

So important has ride sharing become that a national survey completed last month by Certify, a travel and expense management software provider, found that Uber is now the vendor most often expensed by business travelers.

As with car sharing, auto manufacturers are racing to get into the ride-sharing game, with GM’s $5 million investment in Lyft being the biggest move of all so far. But, here again, ride-share cars still need to be fueled. So, any potential negative impact on our industry is hard to see.

There’s a big lesson in all of this. The fuel and fluid handling equipment industry is a good place to be. Even in a time when multiple disruptive forces are rocking the transportation world, our little corner of that world remains strong and stable.

PRUITT CONFIRMED AS EPA ADMINISTRATOR
The U.S. Senate confirmed Oklahoma Attorney General Scott Pruitt as administrator of the U.S. Environmental Protection Agency (EPA) on Feb. 17 by a 52-48 vote. In his initial meeting with employees at EPA headquarters, Administrator Pruitt said, “I believe that we as an agency, and we as a nation, can be both pro-energy and jobs and pro-environment. But we don't have to choose between the two. I think our nation has done better than any nation in the world in making sure that we do the job of protecting our natural resources and protecting our environment, while also respecting the economic growth and jobs our nation seeks to have.”

LAST DAY TO SAVE ON PEI WOMEN CONFERENCE
Early bird registration for the 2017 PEI Women Conference, April 25-27 in Savannah, Georgia, closes today, Feb. 28. In its first two years, this conference proved to be one of PEI’s most exciting new programs. The terrific speakers, nonstop networking opportunities and beautiful setting in Savannah ensure that this year’s event will continue the streak. Register by midnight tonight to receive the early bird rate of $495 ($595 for those who have not yet joined PEI Women). To learn more and register, click here.

ASTSWMO SCHEDULES UST WORKSHOP
The Association of State and Territorial Solid Waste Management Officials (ASTSWMO) has scheduled a UST Compliance and Prevention Workshop, May 23-25 in Louisville, Kentucky. One of the workshop’s sessions will review testing procedures in PEI/RP1200, Recommended Practices for the Testing and Verification of Spill, Overfill, Leak Detection and Secondary Containment Equipment at UST Facilities. Another will discuss options and procedures for the proper disposal of water used in hydrostatic testing of spill basins and containment sumps. Registration is open to industry participants, but space is limited and priority will be given to ASTSWMO members and other state and federal officials.

AUTOMAKERS SEEK TO REVERSE CAFE STANDARDS
Two trade associations representing U.S. automobile manufacturers petitioned the EPA to withdraw a Jan. 12 decision by then-Administrator Gina McCarthy finalizing vehicle greenhouse gas (GHG) emission and corporate average fuel economy (CAFE) standards for model year 2022-2025 light-duty vehicles (see Jan. 19, 2017 TL). The standards require that the nation’s light-duty fleet achieve a CAFE of roughly 54.5 mpg by the 2025 model year.

The EPA was required to evaluate and finalize 2022-2025 standards by April 1, 2018. In its petition, the Alliance of Automobile Manufacturers, which represents GM, Ford, Toyota and nine other automakers, argued that the EPA’s early decision (nearly 16 months before the deadline) was "the product of egregious procedural and substantive defects" and "riddled with indefensible assumptions, inadequate analysis and a failure to engage with contrary evidence." The Association of Global Automakers, which represents the U.S. operations of Honda, Nissan and 10 other automakers, made similar arguments in its petition.

An EPA spokesperson said the agency is reviewing the requests.

SHELL ANNOUNCES EMV STATUS AND PLANS
Shell announced Feb. 22 that payment systems inside more than 80 percent of its 11,000 Shell-branded sites are now fully EMV compliant, with 100 percent compliance expected in spring 2017. Shell also said it is committed to having EMV-ready forecourt payment systems at all of its branded stores before the October 2020 liability shift. A pilot for the company’s outdoor EMV solution will be launched later this year.

APPOINTMENTS
SouthEastern Petroleum Systems, a Charlotte, North Carolina-based fueling system service and installation company, has hired George Wright as its assistant installation coordinator and project manager. Wright, who has 24 years of industry experience, will be responsible for quoting, scheduling and managing new fueling installations and upgrades throughout North Carolina, South Carolina, Virginia and Georgia.
RAASM USA has named Steve Green as its new CEO. Green brings to RAASM USA more than 30 years in the automotive industry, most recently as general manager for Nussbaum Automotive Solutions, LP. RAASM USA is a fluid and lubricant handling equipment company based in Charlotte, North Carolina. The company’s parent, RAASM S.p.A., is located in Vicenza, Italy.

BRIEFLY NOTED
“Jaguar has made in-car payment for fuel a reality via a partnership with Shell. Owners of 2018 F-Pace, XE, and XF vehicles in the UK can now pay for fuel at a Shell station via an app that’s part of the vehicle's in-dash infotainment system, and the feature will be rolled out globally to other markets later in the year.”—Forbes, Feb. 20, 2017
“President Donald Trump’s executive order clamping down on new rulemakings at EPA and other agencies could lead to a broad reworking of how regulators calculate new rules’ costs and benefits, creating an opening to restrict use of metrics the GOP has long claimed overstate the health and economic benefits of regulations while understating costs.”—Inside E.P.A. Weekly Report, Feb. 3, 2017
“In the future, you won't see one of Mercedes-Benz's diminutive Smart vehicles stopping at a gas station unless its driver has a craving for a bottle of Dr Pepper or a lottery ticket. … Beginning in September with the 2018 model year, the lineup will only be offered as the Smart Electric Drive coupe and convertible.”—The Car Connection, Feb. 14, 2017
“General Motors Co. (GM) might deploy thousands of self-driving electric cars in test-fleets by 2018 in partnership with the ride-hailing service Lyft, according to reports Saturday.”—International Business Times, Feb. 18, 2017
“Royal Dutch Shell Plc will build seven fueling stations for hydrogen cars in California through a partnership with Toyota Motor Corp. … The stations will nudge the state closer to its goal of having 100 retail sites by 2024 where hydrogen fuel-cell vehicles can fill up.”—Bloomberg BNA Environment reporter, Feb. 24, 2017

DEATHS
John B. Millet, Jr., longtime owner and president of New York-based Austin Mohawk and Co., LLC, died on Feb. 14, 2017, at age 74, at his home in Florida. A graduate of Milton Academy, Harvard College and Harvard Business School, John spent 40 years guiding Austin Mohawk. Survivors include: his wife of 52 years Roberta; daughters Wendy, Elizabeth and Sarah; grandchildren Celia, Scarlett, Gretel and Zizi; his sister Polly; and his brother David.

ADMITTED TO PEI

Daisho Company CA, Maturin, Monagas, Venezuela (S&C)
Hoosier Equipment Service Inc., Plainfield, IN (S&C)

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The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Richard C. Long, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.