AT&T to invest $565 million on green vehicles, Ford to benefit

12 March 2009

AT&T Inc will spend $565 million over 10 years to replace or buy about 15,000 vehicles in its corporate fleet with cars and other vehicles that run on alternative fuels, the company said on Wednesday. The telecommunications giant said the investment would be the biggest of its kind by a US company, with struggling Ford Motor Co a key beneficiary.

AT&T chairman and CEO Randall Stephenson told the Economic Club of Washington that fleet modernisation would significantly lower fuel costs. The company will buy about 8,000 work vans or technician trucks that run on compressed natural gas over five years - to be built by Ford.

''AT&T and other US corporations have a unique opportunity to partner with the new administration as it works to lead the country out of this economic downturn,'' said Stephenson. ''While there are no easy solutions to the challenges facing our nation, this investment is a first step on our part to help boost other industries while at the same time encouraging wider use and production of efficient vehicles and domestic fuel alternatives.''

The alternative-fuel vehicles should provide a 39-per cent improvement in fuel economy and a 29-per cent reduction in greenhouse gas emissions. AT&T will replace 7,100 passenger cars in its fleet over the next 10 years. Initially, these vehicles will be hybrids. However, as newer alternative-fuel vehicles become available, AT&T will consider them as well.

The hybrids will include a combination of gas-electric and plug-ins, and the trial includes mostly those made by Ford, with some from Toyota Motor Corp, according to Tim Harden, president of supply chain at the company. AT&T will also work with natural gas service providers to build up to 40 new CNG fueling stations across the company's operating region to put the fueling infrastructure in place.

The Center for Automotive Research in Ann Arbor, Michigan, estimates that AT&T's investment in the new vehicles will save 49 million gallons of gasoline and reduce carbon emissions by 211,000 metric tons over the 10-year deployment period. That's the equivalent of removing the emissions from more than 38,600 traditional passenger vehicles for an entire year.