With the help of turnkey electric vehicle service provider 7 Generation Capital, delivery company Courant Plus snagged two brand new Ford e-Transit vehicles for its zero-emissions courier business
Montreal-based Courant Plus, a last-mile delivery company, is blazing a trail in Canada as the operator of two brand new Ford e-Transit vans.
The e-Transit vehicles, which arrived in April through an “electric vehicle as a service” deal with Vancouver-based 7 Generation Capital (7Gen), are among the first to be deployed in Canada and mark another achievement in Courant Plus’ sometimes bumpy reality of being a zero-emissions courier in Canada.
“Equipment was our main point of struggle — [with a] fleet of Chevy bolts we could only take 30-35 packages per trip. So if you want to run hundreds of packages a day you needed two or three vehicles, and two or three drivers, and a dispatcher,” Courant co-founder Edwin Richard tells Electric Autonomy Canada in an interview.
Now, with the e-Transit, a full-sized cargo van with the same interior dimensions as its diesel counterpart, the Ford Transit, and approximately 200 kilometres of range per charge, Courant will be able to make even more zero-emission deliveries.
According to the company’s website, Courant Plus delivery ZEV fleet also includes “two trucks, 20 feet and 18 feet, electrified in Laval, an [electrified] Econoline Ford van, … six electric cars, and as many cargo bikes [with] electrically assisted towing trailers capable of carrying 300 lbs of payload.”
Courant Plus launched in 2019 as a carbon-free, last-mile delivery service, initially with a fleet of electric cargo bicycles as well as the Chevy Bolts, then added converted zero-emission light duty trucks. But buying larger new electric vehicles, like the e-Transit, is a big expense and traditional equipment financing providers were “not ready” to work with the Courant on electric vehicle financing, Richard says.
So Courant required assistance and mentorship from a partner already in the space and with experience on fleet transitions. Even better, 7Gen’s contacts in the Canadian dealer network enabled it to secure early access to several of the first e-Transits in the country.
“When 7Gen approached us with their package deal already in place, with financing for the equipment and the charger station … of course we listened to that,” Richard says.
Electric vehicles as a service
7Gen bills itself as a turnkey electric vehicle service provider, offering its customers all-in-one electric vehicle leasing, installation, charging, and maintenance service. Last year Spring Lane Capital, a Boston and Montreal-based private equity firm, invested $20 million in 7Gen, an endorsement of its “electric vehicle as a service” (EVaaS) approach to fleet electrification.
“We come in with knowledge and expertise on how to design the best infrastructure, how to maximize the fleet using software, and we also provide the capital. We provide the vehicle, the infrastructure, all costs of the installation, and then lease it to our customers as a whole package,” says Fred Bel, 7Gen’s vice-president of business development and marketing. This, he claims, effectively “de-risks” fleet electrification for companies by converting the high capital expense of fleet electrification into a fixed operating expense.
Under the EVaaS model, Bel says these operating numbers mean it now “makes more sense for companies to consider electric fleets from day one” as fleet managers will save money long-term thanks to reduced maintenance costs due to fewer moving parts, and the benefits of regenerative braking, and, crucially, much lower fuel costs.
“The breakeven period is getting shorter and shorter,” Bel says.
The Ford e-Transit’s base model is priced at around $60,000 Canadian, compared to $42,000 for its diesel equivalent, but Bel says the total capital expenditure for a commercial electric vehicle can be three or four times a similar diesel vehicle because of charging infrastructure costs.
Despite this higher capital investment, Courant’s Richard says he is convinced fleet electrification both makes sense as an idealistic proposition, and a financial investment for Courant Plus.
“Yes, there is a surcharge when we first buy the equipment,” he says. “But when we started in 2019 we believed we were doing the right thing, and since then we have been proven right.”
Crucially, the fixed operating costs offered by 7Gen and the vastly lower fuel costs required to run its EVs means Courant Plus can offer its customers pricing certainty far into the future, which Richard says is a significant advantage for the business.
“We are now able to lock in prices for our customers for a year, a year and half,” Richard says. “Which is unheard of as right now in transportation, you change the fuel surcharge [to your customers] every week, because it’s so volatile. So it’s impossible for any other transportation company to lock in prices for twelve months — but we can.”
Electric van supply is tight
Both Bel and Richard cite vehicle access as one of the key challenges facing any company that is looking to electrify its fleet.
While supply chain issues are dogging the vehicle manufacturing industry at large, Bel says current EV production levels are simply not high enough to meet rising demand in the commercial space. That’s why 7Gen is working to develop connections with original equipment manufacturers, such as Ford, to secure vehicles for their clients.
“Because we only deal with electric vehicles we are starting to be known to the OEMs — we look at what they’re going to produce, when they’re going to deliver the vehicles, so we understand what is good and what isn’t, and where the challenges lie.”
For Courant Plus, this meant landing the first e-Transits available in Quebec. The vehicles are part of the initial run of 10,000 e-Transits from Ford’s dedicated electric assembly plant in Kansas City, Mo., which began shipping to North American customers in February. Other initial purchasers include retail giant Walmart, which ordered 1,100 e-Transits and Philadelphia-based truck leasing company Penske, which bought 750. In Europe, Ford is filling an initial run of 5,000 e-Transit orders with vehicles made at its Turkish assembly plant.
In North America, the next delivery window for the e-Transit is planned for 2023.
Many contenders on the way
The e-Transit is part of a growing line-up of electric light commercial vehicles coming to market. General Motor’s Brightdrop Zevo 600 arrived on North American roads in late 2021 when FedEx received the first 500 produced from GM’s assembly plant in Michigan. Mercedes Benz is testing its eSprinter van in Sweden ahead of a slated 2023 North American release, with the German company’s existing Sprinter assembly plant at South Carolina taking on production in 2023.
Smaller players are also edging into the electric van market, such as London-based Arrival, which is currently constructing an assembly plant in North Carolina to build commercial EVs using a modular component system. Californian company Rivian, which listed on the NASDAQ exchange in a $US12-billion initial public offering in late 2021, has a contract to provide 100,000 electric vans for Amazon by 2030.
Despite the relatively small numbers of commercial EVs on the market today, Richard says Courant Plus has demonstrated that it is feasible to run a zero-emission delivery business, and that the partnership with 7Gen also shows other companies in the sector that it can be done.
“The 7Gen partnership was good not only for us but these kinds of partnerships are good for the rest of the transportation industry — because we need to move forward faster and with more ambition,” says Richard.
Bel agrees, saying that companies thinking of making the switch need to know the process can be done in stages to accommodate funding, vehicle availability, and infrastructure development.
“Don’t think about changing your whole fleet overnight,” he says. “Go step by step.”