UPS turns to Arrival for some very stylish electric delivery vans
Another relatively new electric-vehicle company has scored a major deal to electrify some of the world’s delivery fleets.
The shipping and logistics company UPS announced last week that it’s investing in the UK commercial electric-vehicle maker Arrival—and ordering 10,000 electric delivery vehicles from the company.
With the investment for an undisclosed amount, UPS gets an equity investment for a minority stake, and it follows soon after an investment from Hyundai and Kia in Arrival last month (that one for an announced amount of $110 million).
The UPS deal includes both a commitment to purchase 10,000 Arrival EVs specially made for UPS and “priority access to purchase additional electric vehicles.”
UPS currently has a total fleet of 123,000 delivery vehicles, so it's a small but meaningful move toward reducing or offsetting the increase in delivery-van emissions due to e-commerce deliveries.
The two companies will also co-develop Advanced Driver Assistance Systems (ADAS), which includes automation at UPS shipping depots. From the sound of it, the projects might fit nicely with Arrival’s co-development projects with Hyundai and Kia.
Arrival makes its own core vehicle components and modularizes its platform so as to accommodate a wide range of vehicle types and sizes. The company claims a 50% savings in operational costs versus comparable internal-combustion vehicles, and it first gained attention when it placed some its very distinctive vehicles in service in 2017 for the UK’s Royal Postal Service.
The UPS vehicles will be put to use in both Europe and North America, while it notes that Arrival will make the vehicles for them in micro-factories, with the 10,000-vehicle lot to be delivered starting later this year in the UK, with completion by 2024.
Altogether, the structure of the UPS/Arrival deal is like that of Amazon investing in Michigan’s Rivian—only the Rivian deal was quite a bit larger. Under that relationship, Amazon first led a $700 investment round and then some months later the two companies announced an agreement in which Rivian would provide 100,000 fully electric vans to Amazon by 2030, with the first 10,000 on the road as early as 2022.