EV startups seek edge as big automakers roll out vans and trucks

  • Major automakers rush to mass-produce electric vans
  • Small commercial electric vehicle startups risk being squeezed out

FARNHAM, England, Feb 15 (Reuters) – As traditional carmakers gear up to produce electric vans and trucks, startups are more focused than ever on finding a competitive or technological edge to stay on the road a once their biggest rivals start shifting gears.

Spurred by impending bans on combustion engines in China and Europe, major automakers are scrambling to get their commercial electric vehicles (EVs) to market quickly and ensure they don’t get caught up in another Tesla ( TSLA.O).

To survive in a world where General Motors (GM.N), Ford (FN), Renault (RENA.PA) or Stellantis (STLA.MI) can manufacture hundreds of thousands of pickup trucks a year, superior software or technology could make all the difference for new entrants.

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“Startups all bring something to the party,” says Jean-Michel Renaudie, senior vice president for industrial and commercial transportation at automotive supplier TE Connectivity (TEL.N). “The question is, what is your unique selling point?”

For British startup Bedeo, the answer changed last year due to an unexpected turn of events.

When property developer China Evergrande Group (3333.HK) ran into debt troubles, its subsidiary National Electric Vehicle Sweden (NEVS) put electric motor startup Protean Electric up for sale – and Bedeo bought it.

Until then, Bedeo had transformed pickup trucks such as Peugeot’s Boxer and Opel’s Movano into electric vehicles for Stellantis by adding electric motors, batteries and an operating system at a factory in Turkey. It also sold its own electric vans to customers such as FedEx’s TNT (FDX.N) and Deutsche Post’s DHL.

Now, Bedeo and Protean plan to develop new electric vehicle platforms for commercial vehicles and passenger cars using in-wheel motors, Bedeo chief executive Osman Boyner told Reuters.

In-wheel motors – self-contained electric motors that can be housed in all or part of an electric vehicle’s wheels – don’t need axles or drivetrains, so they free up more interior space vans and trucks, and extend battery life by reducing vehicle weight.

At Protean’s headquarters in Farnham, near London, Managing Director Andrew Whitehead shows off a production-ready sports car developed under NEVS with in-wheel motors with a 1,000 km (620 mile) range, well beyond previous electric vehicles currently available.

“Every vehicle will have in-wheel motors one day because it’s a given,” Boyner said. “We already have this technology on the road and we just need to bring it to market.”

‘GORILLA IN THE MARKET’

The stakes are high. About 9 million delivery vans are sold globally each year, and with global distribution and retail companies under increasing pressure to go green, orders for bumper commercial electric vehicles are expected to pour in quickly.

Boyner said Bedeo was talking to major automakers about building commercial electric vehicle platforms for them under contract, but also to its own investors about whether to go it alone, with a decision expected by the end of the day. end of June.

“Should we invest half a billion and compete with manufacturers, or should we just supply components?” he said. “These manufacturers are so big they’re like governments.”

Large automakers such as GM and Ford (FN) pose a huge challenge for startups because they can leverage their large factories, global sales, service and distribution networks, and longstanding customer relationships.

“Knowing how to manage the supply chain at scale is a huge, huge advantage,” said Travis Katz, general manager of BrightDrop, GM’s electric vehicle business, which announced large orders from FedEx and Walmart (WMT.N) for its mass product. EV600 van.

Ford is a leading brand in the US and European van markets and Sam Fiorani, vice president of global vehicle forecasts at AutoForecast Solutions, said its Transit van is “the gorilla of the market”.

“They are ready to respond to any commercial buyer,” Fiorani said. “It’s a lot to overcome.”

US startup Rivian Automotive (RIVN.O), which makes electric pickup trucks, SUVs and commercial vans, has been touted as the next Tesla and its valuation jumped 53% to top $100 billion the day it was launched. listed its shares in November.

Rivian landed an order for 100,000 vans from Amazon, but its shares took a hit after the online retailer said last month it was teaming up with Stellantis in a host of areas, from software to cloud computing – to electric vans.

Ross Rachey, director of global fleet and products at Amazon, said the company is partnering with established players such as Stellantis and Rivian because there “is no one-size-fits-all approach, there is place for many actors”.

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KNOW-HOW AND NETWORK

Some investors, however, say startups are a riskier bet because they could fail.

“What will happen if in five years these startups disappear?” said Scott Schermerhorn, managing director of Mariner Wealth Advisors, which owns GM stock.

FedEx was burned last year when startup EV Chanje, which promised it 1,000 vans, then went out of business.

The package delivery company ordered thousands of electric pickup trucks from GM’s BrightDrop because it had the “know-how, scale, easy access to capital” and network to support large fleets, said Richard Smith, head of FedEx for the Americas.

But he said FedEx remains open to startups with “innovation and new technology.”

Ed Sun, managing director and portfolio manager at investor Engine No. 1 in San Francisco, said startups may lack scale but can survive because they often have better software, lineup, vehicle technology or a niche. .

“New players are clearly going to take stakes,” said Sun, whose company owns GM and Ford shares.

For Arrival, the British electric van startup, low-cost innovation is the way forward.

It plans to develop “micro-factories” and use an inexpensive, lightweight plastic composite for van bodies. Backed by its own fleet management software, its executives say it’s a better van than a diesel equivalent for the same price.

Swedish startup Volta Trucks is one step ahead of traditional truck makers as its 16-tonne electric truck goes into production this year. It features a low center seat and wrap-around windshield, placing drivers at eye level with pedestrians to improve road safety in busy cities.

‘PROOF FOR THE FUTURE’

British electric truck maker Tevva, meanwhile, is getting into the niche.

He buys “gliders” – the chassis and cab of the truck – from an established automaker to benefit from their networks. Then it adds its own electric motors, batteries, software and, in some cases, hydrogen fuel cells, effectively turning these models into clean-fuel dual action with greater potential range.

“We don’t need to invest hundreds of millions in parts that someone else is already doing well,” chief executive Asher Bennett told Reuters.

Tevva, which tests trucks with UPS (UPS.N), will begin production of two versions of a 7.5 tonne (7,500 kg) vehicle at its plant in Tilbury, England this year.

One will be an electric model with a range of 160 miles but the other will have a reserve hydrogen fuel cell, bringing its range to 310 miles. Tevva plans to deploy 12 and 19 ton models with hydrogen boosters.

Tevva has pre-selected sites, one plant in the United States and one in mainland Europe, each capable of producing some 3,000 trucks a year.

Many in the trucking industry believe that hydrogen fuel cells, which emit only water, are the future because they are lighter than batteries, although the fueling infrastructure is in its infancy. stammering.

Bennett said the combination of hydrogen technology, low-cost manufacturing and cloud-based software to optimize vehicle range “will future-proof our business.”

US delivery giant UPS, meanwhile, said working with startups such as Arrival has helped it shape the kind of electric vehicles that will join its global fleet of 130,000 vehicles.

UPS worked with Arrival on the design of a chassis, powertrain and vans and has now ordered up to 10,000 vans.

“We saw this was a solution we could extend to support our global operations,” said Luke Wake, UPS vice president of maintenance and engineering.

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Reporting by Nick Carey in Farnham and Tilbury, England, and Ben Klayman in Detroit; Editing by David Clarke

Our standards: The Thomson Reuters Trust Principles.

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