Speed-to-market and scalability: the key to winning the red-hot electric delivery van race

As more people shop online, FedEx estimates the U.S. market will experience deliveries of up to 100 million parcels per day in 2022. This massive e-commerce growth has led to a race to decarbonize last-mile delivery vehicles. ?Three of the key factors driving this are: 1) the impact of non-electrified last-mile delivery vehicles on greenhouse gas emissions, 2) consumers becoming increasingly conscious of the environmental issues relating to CO2 emissions[1],[2], and 3) delivery companies wanting to take advantage of the operational economic benefits of electric vans[3]. As a result, e-commerce companies such as Walmart and FedEx have committed to being carbon neutral by 2040, with a focus on electrifying their vehicle operations.

Many companies are currently working to reduce carbon emissions, with a goal of decarbonizing last-mile deliveries, increasing pressure on fleet managers to find an electric vehicle supplier that can deliver vehicles quickly and at scale.

However, ongoing global supply chain issues are contributing to fleets’ challenges in acquiring electric vehicles and doing so on short notice.

The pandemic caused severe supply chain problems across the globe and every part of the global market was impacted, especially the automotive industry. In 2021 the semiconductor shortage reportedly cost the global automotive industry an estimated $210 billion in lost revenues and this shortage was just one of many challenges impacting this industry. Other issues affecting the global supply chain across all industries in 2020 and 2021 were steel shortages, labor shortages, and container shipping prices increasing up to nine times pre-2020 rates. As a result, many automotive manufacturers simply had no choice other than to reduce production.

Due to the global supply chain issues, shoppers in the market for consumer and commercial vehicles may find it difficult to locate what they need, something that was almost unheard of in the pre-pandemic world. One of the main problems fleet managers will likely face is that many of these supply chain challenges may go unresolved for a long period of time. Labor shortages show no sign of being alleviated[4], and geopolitical tensions[5] and trade disputes[6] also look set to continue.

?Bringing an electric van from concept to commercialization in 20 months

?At BrightDrop, we’ve worked hard to reach commercialization in record time and are on track to scale production by the end of 2022. The BrightDrop Zevo 600 van was the fastest vehicle program, from concept to commercialization, in GM’s history. In only 20 months we designed, produced and delivered vehicles to our first customer in December 2021 – the same calendar year that BrightDrop was launched – and amid a global pandemic and supply chain challenges.

How was this possible? We have a unique setup where BrightDrop operates as a GM wholly owned tech start-up focused solely on the last-mile delivery ecosystem. Through this relationship we can act with the innovation, focus, speed, and agility of a startup while also leveraging over a century of automotive manufacturing, safety and reliability experience and resources at our fingertips. For example, our vehicles are assembled and calibrated in factories with advanced capabilities, using state-of-the-art robotics that allow direct human-robot collaboration.

Another key advantage is BrightDrop’s ability to leverage the Ultium Battery Platform. Efficient battery systems can arguably be the hardest part of EV development. The BrightDrop Zevo 600 van is powered by the Ultium Battery Platform and motors, supplied by GM. The configuration of the Ultium battery and motors provide BrightDrop more versatility and flexibility in designing its vans. The Ultium Battery Platform, can be arranged in different combinations of flexible modules and battery packs to provide energy for every segment on the road today – from performance vehicles to work trucks. BrightDrop’s Zevos are the first entrance of the GM Ultium platform to the commercial vehicle segment.??

BrightDrop took the established capabilities of GM and combined it with agility and a start-up mindset, bringing faster innovation cycles and tolerance for potential failures. With BrightDrop, we’re able to move quickly, and alongside GM, we’re in a position to deliver electric last-mile vehicles today.

?To learn more about the innovation and manufacturing capabilities of BrightDrop, follow us on LinkedIn, or get in touch.

[1] Emmert, A. (2021), The rise of the eco-friendly consumer. Strategy + Business. Available here.

[2] PwC, (2021), Consumers becoming more eco-conscious and willing to travel, attend events, PwC survey reveals. PwC. Available here.

[3] Tabak, N. (2020), Why last mile leads charge for EV adoption. FREIGHTWAVES. Available here.

[4] Tappe, A. (2022), No end to the worker shortage: America had 11.3 million jobs available in January. CNN Business. Available here.

[5] Samson, Romei, & Rocco (2022). How will geopolitical tensions affect markets? Financial Times. Available here.

[6] Restuccia, Landers, & Thomas (2022). Biden’s Asia trip shows challenges in uniting region. Wall Street Journal. Available here.