You might not hear it when a DHL delivery van rolls up to your home or office in the coming years. One of the world’s largest courier services, it’s planning to buy 2,000 Ford E-Transit delivery vans to replace its current fleet of diesel and gas trucks by the end of next year, it announced Monday.

General Motors officials, meanwhile, confirmed plans to provide a “fleet” of its own BrightDrop Zevo vans to DHL — the first of those all-electric models going into production at a plant in Ingersoll, Ontario the same day.

DHL has already plugged into electric propulsion, last year purchasing 98 Ford vans converted to run on by battery power by Lightning Motors. And the courier service is far from alone. Competitors like UPS and FedEx are also going electric, as is online shopping giant Rivian which has committed to purchasing 100,000 vans from EV startup Rivian — in which it holds an 18% stake — along with a smaller number of vans from Stellantis.

EV sales soar

Sales of battery-electric vehicles have been on a rapid climb, industry data show. In the retail market, EVs made up barely 1% of new model sales at the end of 2019. That shot to 5% during the first half of 2022 and is now approaching 7 percent.

The commercial EV market got off to a much slower start but has now been on a faster growth curve, according to industry analysts. Mordor Intelligence forecasts demand will jump from a global total of $67.5 billion last year to $258.8 billion by 2025. That includes everything from electric pickups used for commercial applications, like the Ford F-150 Lightning and Lordstown Endurance, to the big Class 8 Semi Tesla said it is about to start delivering.

But demand is growing especially fast in the last-mile delivery segment, according to Sam Abuelsamid, principal auto analyst with Guidehouse Insights. Ford, for example, expects the E-Transit to account for a full 25% of its total EV run rate — about 600,000 all-electric vehicles annually — by the end of next year.

“There’s an absolutely huge amount of interest in electrifying those vehicles (and) makes a lot more sense than it does for retail customers.”

EV advantages

While range might be a serious challenge for Class-8 long haulers, it’s a relatively minor concern for the last-mile delivery trucks that weave their way across the American landscape. Ford notes that its typical Transit van clocks about 74 miles a day, a distance easily handled by the E-Transit which can deliver 126 miles, fully loaded, on a single charge. That’s in line with what the delivery vans from Stellantis, Rivian and GM’s BrightDrop subsidiary can muster.

Meanwhile, they are far more energy efficient than models using internal combustion engines which max out at around 7 to 8 miles per gallon. A study by Consumer Reports found that EV models have about half the operating costs when you factor in both energy and maintenance. Electric models don’t need tune-ups or oil changes and, preliminary studies suggest, they have less down time for maintenance.

In most cases, such delivery vans report back to a central depot at the end of the day. There they typically can be charged overnight using relatively low-cost 240-volt Level 2 chargers. But some services running continuous operations may add faster DC quick chargers that can put an EV van back on the road within an hour or so.

There are other pluses. They also are quieter, something Abuelsamid sees as a plus for both drivers and neighborhood residents. And they’re cleaner operating, even in regions of the country where coal makes up a major source for electric utilities.

A “major pillar”

“Electrification of last mile logistics is a major pillar to decarbonize our operations,” said Anna Spinelli, Deutsche Post DHL Group’s chief procurement officer. “Adding the new Ford E-Transit to our global fleet of around 27,000 electric vans further strengthens our capability of providing green delivery services worldwide.”

Ford and BrightDrop, meanwhile, are introducing a variety of digital features on their EV vans that not only help keep track of where drivers are on their routes but closely track vehicle operating conditions.

The shift to EVs is rapidly becoming a worldwide phenomenon. DHL, for example, has battery-electric trucks serving routes in Bulgaria, Belgium, the Czech Republic, Germany, Luxembourg, Mexico, the Netherlands and the United Kingdom.

Amazon ordered 1,800 Mercedes-Benz electric Sprinter vans two years ago for use in Europe. The retailer also will be the first customer for Stellantis’ Ram ProMaster EV which will go into production next year.

An up-front price premium

As with retail battery-electric vehicles, the new EV delivery vans do carry a price premium. And with the cost of raw materials like lithium, nickel and cobalt on the rise, that threatens to diminish the lower costs for energy and maintenance, cautioned Stephanie Brinley, principal auto analyst with IHS Markit.

“They still have to be affordable,” she said. “Right now many cos are willing to make the (added) up-front investment” to demonstrate their commitment to sustainable operations, Brinley added, “but they need to be affordable over time.”

Longer term, most manufacturers expect raw material costs to stabilize and then drop as more sources are developed. Battery costs are expected to start dropping again and, most forecasters project, EVs should wind up being more affordable to purchase than conventional gas and diesel models before the end of the decade. That would make it an even easier sell to fleet buyers.

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• Source: https://www.thedetroitbureau.com/2022/12/delivery-services-and-other-commercial-buyers-plug-into-evs/