Toronto has become a testing lab for electric-delivery vehicles.
First, Canada is home to the biggest FedEx e-bike fleet, and has become a blueprint for other countries. That’s according to Jeff Gilbert, senior operations manager at FedEx Express Canada, who oversaw the shipping giant’s first North American launch of the initiative in Toronto. He told The Logic he gets a phone call about once a week from another FedEx location—from London to Frankfurt to Mexico City—that’s considering an e-bike fleet of its own.
In another example, General Motors piloted electrified parcel-delivery pallets for electric BrightDrop vans in Canada’s largest city, too, before rolling out a second pilot in New York City. FedEx could soon have as many as 20,000 of the Ontario-made vans across its global fleet as it tries to electrify it by 2040.
Why Toronto became the front line of the delivery wars: Some of FedEx’s most challenging deliveries are in areas where drivers have to spend long periods idling in traffic and looking for parking, avoiding construction and navigating high-rise buildings. That plus growing cycling infrastructure built in the city during the pandemic made Toronto an “obvious choice” to try smaller electrified bikes and pallets, Gilbert said.
Why it matters: Rising fuel costs and e-commerce fluctuations during the pandemic have delivery companies rejigging their businesses. Canadian retailers are reporting higher shipping costs due to fuel surcharges and FedEx is cutting deliveries on Sundays in some markets as e-commerce wanes post-pandemic.
EVs are not only cheaper to fuel, but more efficient. Gilbert said the e-bikes can make upwards of 20 stops an hour while a truck will do around 13. The GM e-pallets, meanwhile, led to a 25 per cent increase in package deliveries per day.
The competition: Purolator unveiled its new national hub in Toronto this week, where it will be the first in Canada to use machinery that will help it unload trailers 10 times faster, up to 12,000 parcels an hour. The company, majority owned by Canada Post, deployed EVs for curbside delivery last year, expanded its e-bike fleet in 2020 and also has 315 hybrids.
Companies like FedEx and Purolator must compete with Amazon, now the largest package shipper in the U.S. It is going big on electric, ordering 100,000 vans from Rivian (of which 10,000 would be deployed this year), as well as 2,500 from Quebec’s Lion Electric.
Canada Post says it will electrify its 14,000-truck fleet by 2040. UPS has 13,000 “alternative fuel” vehicles, with 1,000 hybrids or EVs and another 10,000 EVs on order.
The takeaway: As logistics companies try to streamline their businesses, more cities may start to look like Toronto—flush with smaller electric delivery vehicles—and learn from this Canadian testing ground.
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