It’s not as chatty as Star Wars’ C3P0, nor anywhere as cute as R2D2, but the droid-like EP1 could soon become a vital part of the e-commerce business, at least if General Motors has its way.
The automaker wants to become a major player in the delivery business and, to get there, it is launching the new BrightDrop subsidiary that will offer, among other products, an all-electric cargo van, dubbed EV600, as well as the EP1, a self-propelled cargo palette that looks like a tall tool cabinet on wheels.
Starting late this year, BrightDrop will begin delivering the first of those two products to FedEx, with a number of other cargo fleet operators also ready to place orders, according to Pam Fletcher, the Detroit automaker’s head of global innovation.
“BrightDrop offers a smarter way to deliver goods and services,” Mary Barra, GM chairman and CEO said ahead of a formal debut of the new company at the Consumer Electronics Show on Tuesday. “We are building on our significant expertise in electrification, mobility applications, telematics and fleet management, with a new one-stop-shop solution for commercial customers to move goods in a better, more sustainable way.”
The launch of BrightDrop coincides with GM’s broader push into battery power, the automaker’s now oft-repeated mandate declaring that it is “on a path to an all-electric future.”
The new subsidiary’s EV600 delivery van will use the same basic technology as the GMC Hummer pickup set to debut later this year, starting with its Ultium batteries that will be produced at a new plant set up as part of a joint venture between GM and Korea’s LG Chem.
The van will have a range of about 250 miles per charge which should be able to handle virtually any “last mile” delivery route. The typical van, such as those operated by FedEx, clocks less than 50 miles a day, according to Alf Poor, the CEO of Ideanomics, a company that “facilitates the adoption of commercial electric vehicles.”
The EP1 droids will also be electric, using motors mounted in their wheels to roll along at speeds of up to 3 mph. That will allow them to keep pace with a human worker, reducing strain and injury. Like the EV600 van, the EP1 palettes will use cloud-connected technology that will constantly monitor their location and contents. A pilot test by FedEx found the system capable of boosting productivity by 25%, and it can reduce loss and theft, as well.
The EV600 and EP1 will be just the first products to come from BrightDrop, said Fletcher, hinting that vans both larger and smaller are in the works. And while she would not directly comment about fully autonomous trucks when asked during a background briefing, Fletcher hinted that “the tech roadmap is long.”
BrightDrop, she suggested, will have access to autonomous technology developed by another new GM subsidiary, San Francisco-based Cruise. That company recently received approval to begin public testing of fully driverless ride-sharing vehicles.
With the launch of the new subsidiary, GM goes into direct competition with a number of key players, such as Germany’s Daimler, as well as Rivian, the suburban Detroit startup backed by both Ford and Amazon. The online retail giant has ordered 100,000 all-electric Rivian delivery trucks for the U.S., and thousands more from Daimler for Europe.
For its part, FedEx is scheduled to get the first 500 BrightDrop vans by year end, thousands more later on. During Barra’s Tuesday morning CES keynote, FedEx Express Regional President Richard Smith emphasized why the use of new technology, especially the EP1 droids, will be critical. The pandemic has led to a rapid acceleration of e-commerce, he said, noting that forecasts call for 100 million packages to be shipped daily by 2023, three years sooner than was originally expected and “we don’t expect to see it go back” to prior rates once the pandemic ends.
The market for delivery vans – electric ones, in particular – is expected to grow rapidly as Americans steadily shift more of their purchases from brick-and-mortar retailers to online retailers.
The utility truck market is expected to top $90 billion annually by 2026, according to Forbes Business Insight, up from around $47 billion in 2018. Cargo and delivery vehicles are set to make up a significant share of that business.
And where gas and diesel power long dominated, industry watchers like Ideanomics’ CEO Poor see the switch to electric propulsion accelerating rapidly – as underscored by Amazon’s Rivian purchase.
New government mandates clearly play a part. California regulators recently announced plans to phase out trucks using internal combustion engines and those rules will be adopted by more than a dozen other states.
But going green also has a more bankable advantage, as battery prices drop, range and performance improve. Electric trucks require substantially less maintenance and have less down time, while energy costs also are a lot lower. So, said Poor, they “just make sense because there’s almost an immediate return on investment.”