Arrival Electric Vans For UPS, Gas-Powered Crap For USPS

March 24, 20214 years ago Steve Hanley 0 Comments

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It’s a story Charles Dickens could write, were he alive today. He might call it “A Tale Of Two Delivery Services.” One, called United Parcel Service, is staking its future on electric vans manufactured by Arrival. The other, called the United States Postal Service, is firmly committed to last century technology and gasoline-powered vehicles. The former is dedicated to reducing the carbon emissions from its operations. The latter could care less about emissions. Its focus is on pleasing powerful interest groups, the needs of society be damned.

Arrival has a unique manufacturing strategy. Rather than build one or two large factories and distribute its products from them across the country, it proposes to construct what it calls micro-factories close to where the market is for its vehicles. It’s well on its way to completing a factory in York County, South Carolina, where it will manufacture electric buses and has chosen nearby Charlotte, North Carolina as the site for its second US factory, where it will start manufacturing the first of 10,000 battery electric delivery vans for UPS next year.

Those vans will have a range of 150 miles, which is more than sufficient for most of the company’s daily delivery routes that deliver packages from its delivery hubs to customers. They were designed specifically to meet the needs of UPS, but should be ideal for lots of other “last mile” delivery customers as well. Long haul routes between hubs will still be serviced by larger gasoline- and diesel-powered trucks, although UPS is working diligently to lower the carbon emissions from all of its operations. It has ordered 125 Tesla Semis, for instance.

“Our newest microfactory will be producing two different classes of EV vans for our U.S. customers, expanding the zero-emissions options for fleet operators and accelerating the mass adoption of electric vehicles,” Michael Ableson, CEO of Arrival Automotive, tells Car and Driver. “We are pleased to increase our investment as we extend our partnership with the city of Charlotte and believe we will continue to see strong demand for our vehicles as more operators transition to electric.”

Luke Wake, Vice President of maintenance and engineering for UPS Corporate Automotive, adds, “We’re excited by this significant milestone that will enable UPS to economically deploy electric vehicles throughout our global operations at an increasing pace. We can’t wait to see UPS’s new electric vehicles roll out of this factory as this is also one of many paths UPS is taking to reduce its CO2 emissions.”

Arrival & Politics

The Biden administration has announced bold new policies designed to convert the entire US government fleet of vehicles to battery electrics, spur investment in battery manufacturing, and promote more EV charging stations across America — provided all those things provide jobs to American workers. Arrival’s US-made electric vans should mesh well with those policies.

Technically, the vehicles the Post Office uses to deliver the mail are not part of the the US government’s fleet. But the recent announcement that the next generation of postal vehicles will lean heavily on gasoline-powered vehicles manufactured by a politically well connected defense manufacturer hardly squares with the clean transportation goals of this administration. In fact, it is more like a slap in the face to everyone who wants to see the US take decisive action to reduce the carbon footprint of its transportation sector.

But the battle may not be over quite yet. The USPS is always critically short of money. Earlier this month, 17 members of the House of Representatives introduced a bill that would provide an extra $6 billion for the USPS, provided it agrees that 75% of any new vehicle purchases will be battery electrics, according to Reuters. That money could put Workhorse, which had been a leading contender for the new vehicle contract, back in contention. It could also put vehicles from Rivian, Canoo, Arrival, and others in play.

“We welcome and are interested in any support from Congress that advances the goal of a Postal Service vehicle fleet with zero emissions, and the necessary infrastructure required to operate it,” the USPS said on March 8. “With the right level of support, the majority of the Postal Service’s fleet can be electric by the end of the decade.”

The Takeaway

Arrival is a startup, albeit a well funded one, having received a multi-million dollar investment from Hyundai. Its micro-factory concept is unique in the industry, but whether it will make the company more competitive remains to be seen. It is a trifle odd that Tesla has not jumped into the delivery van/medium and heavy duty truck market, given that those vehicles create more carbon emissions per vehicle than passenger cars. But that leaves the door wide open for start-ups like Arrival, Canoo, and Rivian.

As some people have noted in their comments recently, electric trucks may not have the range some owners need for their daily driving needs, but the majority of users travel less than 100 miles a day. Their trucks then sit idle for 12 hours or more — time that could be used to recharge them for the the next day’s tasks. Since the total cost of ownership for electric trucks is significantly lower than it is for conventional vehicles, they appeal strongly to fleet operators for whom the bottom line is a critical factor. Expect to see more and more of them on the road in the next few years.