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FedEx unveils all-electric trucks for Los Angeles delivery; Challenges ahead

FedEx unveils all-electric trucks for Los Angeles delivery; Challenges ahead

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FedEx said four new all-electric delivery trucks will hit the road in the U.S., starting in Los Angeles in June. However, there are challenges before mainstream adoption of the vehicles.

FedEx said Monday that four new all-electric delivery trucks will hit the road in the U.S., starting in Los Angeles in June. However, there are challenges before mainstream adoption of the vehicles.

The expansion of FedEx's alternative-energy vehicle fleet will add the existing 1,800 trucks already deployed. By the end of June, FedEx's alternative vehicle fleet will total 1,869.

FedEx said that it is buying the electric vehicles from two suppliers for deployment in Los Angeles. The plan is to compare the two electric platforms and then decide on a larger implementation.

Navistar will be one of the suppliers via a partnership with Modec. FedEx already uses Modec vehicles in London and will launch five more electric trucks in Paris in May. FedEx will buy two trucks from Navistar. An unnamed supplier will provide the other two trucks for delivery later in 2010.

Both pairs of vehicles will be designed to handle a full eight-hour shift from FedEx Express couriers without a recharge.

While these deployments aren't huge, 10 trucks here and 5 vehicles there add up. Meanwhile, there's real ROI involved since fuel is one of FedEx's biggest expenses. FedEx is aiming to improve its overall vehicle efficiency by 20 percent in 2020.

The problem: There are a lot more challenges ahead for deploying all-electric vehicles compared to hybrids. In a blog post, John Formisano, vice president of global vehicles at FedEx Express, said:

This all-electric vehicle, though, was purpose-built, meaning every system in the vehicle must be designed, tested and built from scratch. To build an entire vehicle from scratch tests the mettle of automotive engineers and customers alike. As we think through the likelihood of this new technology becoming dominant in service to our customers in urban areas, I can foresee a few challenges. These challenges are significant, but need to be conquered to secure the energy future of the United States or any country that wants to end dependence on foreign energy sources.

Here's a look at the challenges of bringing electric vehicle technology to the mainstream via FedEx:

Battery costs:
Formisano notes that "the cost of the 80 kilowatt-hour battery needed to propel this truck and its cargo 100 miles is well above the cost of a large luxury sedan." Obviously, the technology needs to stabilize so those costs come down.

Demand: For the costs of batteries and vehicles to come down, there has to be more demand from the customer side also. Companies like FedEx and UPS aren't going to buy enough vehicles so manufacturers will gain scale.

Preparing the grid: Formisano notes that the grid has to get better. He writes:

I’m told that each (zero emissions) truck will be the equivalent of adding one new house to the grid for peak demand.  Imagine when we are able to put the first 100 electric vehicles into one FedEx Express station, making it a completely electric vehicle station, as we did with our 100% hybrid vehicle station in the Bronx in New York City.  This would be the equivalent of putting 100 houses peak electric needs into 50,000 square feet of space.

In other words, all-electric fleets have real challenges and will require a bevy of solutions.

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Larry Dignan

Editor-in-Chief

Editor-in-Chief Larry Dignan is editor-in-chief of SmartPlanet and ZDNet. He is also editorial director of TechRepublic. Previously, he was an editor at eWeek, Baseline and CNET News. He has written for WallStreetWeek.com, Inter@ctive Week, New York Times and Financial Planning. He holds degrees from the Columbia University Graduate School of Journalism and the University of Delaware. He is based in New York but resides in Pennsylvania. Follow him on Twitter. Disclosure