Workhorse Fleet Of Electric Delivery Trucks For UPS Cost Competitive With Conventional Trucks Without Subsidies

There is a lot of good news in the air for Workhorse*, the Ohio based company that manufactures plug-in hybrid electric trucks for commercial customers. Over the past 12 months, UPS — which operated the largest fleet of alternative fuel vehicles in the world — has been evaluating a Workhouse delivery van to see whether it would be suitable for its fleet. That experiment included tests of the HorseFly autonomous delivery drone that nestles in the top of a van and is used to deliver packages to remote locations while the truck continues along its route.

UPS has now taken delivery of 50 Workhorse vans, and while that is great news — the Workhorse van is up to 4 times more efficient than the diesel-powered vehicle it replaces and has far lower tailpipe emissions — the most important piece of the puzzle is that those 50 trucks have comparable acquisition costs to conventional vehicles without subsidies, according to a joint press release from Workhorse and UPS. “Our goal is to make it easy for UPS and others to go electric by removing prior roadblocks to large scale acceptance such as cost,” says Workhorse CEO Steve Burns.

That is huge news. It’s one thing to approach a prospective customer and say, “My product costs more to begin with but will more than pay for itself over time.” It is quite another to approach a prospective customer and say, “My product costs no more than what you are buying now and will save you a ton of money over the long run.” One way gets you a “Hmm … OK, I’ll  think about it.” The other gets a firm order coupled with the words, “How soon can you deliver?”

“Electric vehicle technology is rapidly improving with battery, charging and smart grid advances that allow us to specify our delivery vehicles to eliminate emissions, noise and dependence on diesel and gasoline,” said Carlton Rose, president of global fleet maintenance and engineering for UPS. “With our scale and real-world duty cycles, these new electric trucks will be a quantum leap forward for the purpose-built UPS delivery fleet. The all electric trucks will deliver by day and re-charge overnight. We are uniquely positioned to work with our partners, communities and customers to transform freight transportation.”

The trucks provided to UPS are custom designed to meet the specifications of the company. They use a cab forward design that leaves more room for cargo, reduces the weight of the vehicle, and optimizes the driving environment for the operator. They are expected to have a range in urban delivery use of around 100 miles.

The 50 electric trucks from Workhorse will join the more than 300 electric vehicles in the UPS fleet in the US and Europe, together with another 700 hybrids currently in service. UPS, which has more than 35,000 vehicles in its global fleet, says its goal is to make electric vehicles a standard selection in most cases in the future. The new trucks from Workhorse will be placed into service in urban markets in Atlanta, Dallas, and Los Angeles. Using feedback gained from those routes, UPS and Workhorse will continue developing the trucks prior to deploying more of them in 2019 and beyond.

Note: the author owns shares in Workhorse.