Shipping giant UPS said it will buy 950 electric delivery trucks from Workhorse Group in what looks to be a key order for the electric vehicle startup.
This tops an earlier UPS order for 50 of the trucks that was part of a test program. Workhorse describes the vehicles as Class 5 N-Gen electric vans. UPS and Workhorse collaborated on the design of the zero-emissions vehicle.
“This is a significant deal because it will be the largest order of electric vehicles in that class in the United States,” Duane Hughes, president of Workhorse, told Trucks.com.
The electric vehicles weigh 5,500 pounds, are equipped with 1,000-cubic foot cargo bays and can carry about 5,000 pounds of payload.
With 60-kilowatt-hour battery packs the N-Gen vans can travel up to 100 miles before they need to be recharged. The cost will be about $6 to travel 100 miles, which is significantly lower than the expense of fuel to run gas or diesel-powered trucks.
While UPS has committed to the order, it’s contingent upon the first 50 trucks. UPS can cancel the order at any time if there are performance issues with the initial 50 test vehicles, according to an 8-K filing submitted by Workhorse.
The all-electric delivery vehicles will cost about the same as conventional trucks but will have a lower operational cost over their expected life because they will be less expensive to maintain, Hughes said.
UPS would save about $170,000 a van compared with a similar diesel delivery truck if it kept the Workhorse vehicles for 20 years, their expected lifespan, he said.
“There are fewer parts in an electric vehicle – you don’t have a transmission or a gas or diesel engine to maintain, which significantly reduces maintenance costs,” Hughes said.
A UPS spokeswoman confirmed the deal with Workhorse but declined further comment.
Workhorse, headquartered in Loveland, Ohio, plans to start delivering the electric vehicles to UPS in September.
Workhorse worked with UPS’ engineers to design the vehicle, relying on what it learned developing an electric prototype in a competition for a contract to build the U.S. Postal Service’s next mail truck, Hughes said.
UPS is an early adopter of innovative technologies. Its order of Workhorse electric vehicles will help the company attain its goal of one in four new vehicles being an alternative fuel or advanced technology vehicle by 2020. Its fleet also includes hydraulic hybrid, ethanol, compressed natural gas, liquified natural gas and propane vehicles.
The company currently has more than 300 electric and 700 hybrid electric vehicles in use in the U.S. and Europe. UPS recently pre-ordered 125 Tesla electric semi-trucks and also is running three of Daimler’s Fuso eCanter electric medium-duty trucks.