Electric Vans, Delayed by Production Problems, Find Eager Buyers

Not long after buying a Ford E-Transit van for his plumbing business last November, Mitch Smedley sat down with some receipts and a calculator to figure out how much the electric vehicle was saving him on fuel expenses.

A few minutes of number crunching showed he was spending about $110 to $140 a week on fuel for each of the four older, diesel Transits in his fleet. Then he worked out how much electricity he was using to charge the electric model to drive the same distance — about 300 miles a week. The cost: about $9 a week.

“I knew there was going to be some savings because our electricity here is very inexpensive,” said Mr. Smedley, whose business is based in Blue Springs, Mo., just east of Kansas City. “But I was amazed when I worked it out. It makes it really, really cheap to operate.”

In the auto industry’s transition to electric vehicles, passenger vehicles have led the way. In the first quarter of 2023, sales of E.V.s were 45 percent higher than the same period a year ago to 259,000 cars and trucks, according to Cox Automotive, a research firm. Tesla remains the largest seller by far, while General Motors, Ford Motor, Hyundai, Volkswagen and others are selling multiple electric models. Cox expects the annual E.V. sales total in the U.S. market to top one million this year for the first time.

So far, commercial light vehicles represent a small proportion of all electric cars and trucks sold, but in many ways battery-powered vehicles are well suited for work fleets. Since trucks and delivery vans often travel limited distances or established routes each day, they don’t need large and expensive battery packs. Most can get by with enough energy to travel about 100 miles before they need a recharge. One factor that makes electric cars significantly more expensive than internal combustion models is that consumers want the ability to travel 250 or 300 miles on a single charge because they fear being stranded far from any place to plug in.

Commercial vehicles are typically parked overnight in lots where they can be easily charged and ready to go with a full battery in the morning. Electric trucks also require less maintenance than traditional vehicles. They don’t need oil changes and have no transmissions, mufflers or fuel pumps that can wear out or break down. And they don’t burn fuel when idling.

More so than consumers, commercial fleet owners look closely at the total cost of owning and operating vehicles over several years. That means they are often willing to accept a higher initial price to buy an electric truck to save money over time through lower fuel and maintenance costs.

Yet, commercial E.V.s have had a slower start in sales, in part because of the troubles of several companies that had hoped to make them. Start-ups like Lordstown Motors, Arrival and Canoo have struggled to start or ramp up production, as has Workhorse, a small manufacturer of commercial trucks. Rivian, a start-up backed by Amazon, had hoped to sell thousands of electric vans to the online retailer by now but has fallen far short of its goals.

The delays created an opening for Ford and G.M., two of the country’s largest automakers, to bring out their own battery-powered work trucks. The E-Transit, a derivative of Ford’s Transit commercial van, is available in various sizes and can be used as a delivery van, a shuttle bus, or as a work truck for contractors, repairmen, plumbers, and other small businesses.

Ford sold about 6,500 E-Transits last year. In March, the United States Postal Service ordered 9,250 E-Transits that are supposed to go into service by the end of 2024.

G.M. created an independent division, BrightDrop, to make a larger vehicle tailored for package and cargo delivery. BrightDrop produced a test fleet of about 500 battery-powered vans that were delivered to customers in 2022, and started commercial production of its Zevo 600 model at a plant in Ontario this year.

Along with the truck, BrightDrop has developed an electric cart to enable drivers to haul many packages from the truck, reducing the number of trips the driver makes back and forth. One version of the cart is refrigerated for deliveries of produce and groceries.

In Hooksett, N.H., Merchants Fleet, a company that manages vehicles used by delivery services, has been testing 150 BrightDrop vans over the past year, and is eager to add more.

Brad Jacobs, the company’s vice president for fleet consulting, said the depreciation cost and the cost of interest on the capital used to buy electric vans is roughly the same as for combustion engine trucks.

“What we’ve learned from the vehicles on the road is that you save anywhere from $10,000 to $12,000 a year because the cost of fuel and maintenance is so much lower with electric vehicles,” he said. “If a company is planning on service life of five years, that’s a savings of $50,000 per vehicle. That’s very compelling.”

Mr. Jacobs said Merchants Fleet has orders for 750 more BrightDrop trucks and reservations on an additional 17,000.

Large delivery companies have been clamoring for electric trucks for years. Amazon hopes to buy as many as 100,000 vans from Rivian, and is considering an electric Ram ProMaster van that Chrysler’s parent company, Stellantis, is supposed to start making this year.

UPS has ordered 10,000 electric vans from Arrival, a start-up company based in Luxembourg that has operations in Britain. Arrival has suffered financial troubles and production delays. FedEx, plans to buy only battery-powered vans starting in 2030, and hopes to operate an all-electric fleet by 2040. It has been testing 150 BrightDrop trucks, is taking delivery on 350 more and has reservations for an additional 2,000.

Nelson Granados, a FedEx delivery driver in Inglewood, Calif., has been using a BrightDrop vehicle for the past year, a white van with the orange-and-purple FedEx logo next to a picture of a bright green plug and electric cord.

Mr. Granados gives the truck a thumbs-up. The truck has comforts the diesel vans lack like a stereo and heated seats, as well as a lower floor that makes entering and leaving easier. “You’re getting in and out all day, so it pays off,” Mr. Granados said. “It’s like a luxury delivery truck.”

Mr. Smedley, the plumber in the Kansas City area, has noticed benefits to his E-Transit besides fuel savings. At job sites, the truck can power equipment like drain-cleaning machines, eliminating the need to lug around a generator. He began taking the van to Kansas City Chiefs games — he has season tickets — so he can use its electric outlets for tailgating parties. The truck also secures him premium parking in the spots at Arrowhead Stadium reserved for electric vehicles.

This year, Mr. Smedley decided to add a second electric model to his fleet, a Ford F-150 Lighting pickup truck. He has also continued tracking the savings he’s reaping from the E-Transit.

“When I look at the cost over five years,” he said with a laugh, “it’s almost like getting a free van.”