BrightDrop, an electric van manufacturer, announced that FedEx Express and Walmart have placed orders totaling 7,000 vehicles, with the FedEx order potentially expanding to include an additional 20,000 units pending the successful conclusion of ongoing negotiations.
General Motors CEO Mary Barra made the announcement during her CES keynote address on Wednesday. BrightDrop is a subsidiary of General Motors (NYSE: GM). FedEx’s Richard Smith, regional president of the Americas and executive vice president, told the media on Tuesday, prior to the announcement, that the package giant was also in talks with BrightDrop about how to address the company’s larger-van package needs (above 1,000 cubic foot capacity).
“BrightDrop’s EV portfolio of the EV600 and EV410 covers our small and medium [needs],” Smith said, noting that the two BrightDrop vehicles could cover two-thirds of FedEx’s future electric fleet. “And we hope they will.”
BrightDrop CEO Travis Katz stated that discussions with FedEx about larger vehicles had taken place.
“The biggest challenge with larger sizes is battery mass, and ensuring that the batteries required to move that size payload do not reduce cargo capacity.” “We are actively investigating this and are spending time with FedEx to determine exactly what they require,” Katz said.
FedEx (NYSE: FDX) was working on a “long-term” agreement for up to an additional 20,000 units, according to Smith. The company is aiming for a zero-emissions future, with electric vehicles accounting for 50% of FedEx and FedEx Express vehicle purchases by 2025 and 100% by 2030.
“We were very excited about GM getting into this space in terms of its [vehicle history]… but also its footprint,” Smith said of BrightDrop’s commitment. “With their footprint, we are very confident in their ability to provide us with a vehicle if one breaks down or to service a vehicle quickly.”
FedEx recently received the first of 500 vehicles from BrightDrop, which was officially announced at the 2021 CES event, and Katz stated that the company will continue to deliver new vehicles to FedEx each week.
“We’re seeing a lot of momentum and excitement around these vehicles,” Katz said, citing previous orders from Merchants Fleet and Verizon, which have reserved up to 18,500 BrightDrop vans.
FedEx also announced plans to expand its use of BrightDrop’s EP1 system to ten new markets in 2022. The EP1 is an electric pallet system that uses an electric hub motor to propel the pallet at speeds of up to 3.1 miles per hour. The EP1, which is built on four wheels and resembles a rolling box, has adjustable shelving and can carry up to 200 pounds. It was designed to work with the EV600, but it can also be used in other applications, such as a recent pilot program in Seattle that used electric cargo bikes to transport it.
