Daimler unveils electric truck, finds customer in US Parcel Service

As Daimler Trucks tries to gain a foothold in the nascent electric-truck market with short-range haulers, Daimler AG on Thursday said United Parcel Service Inc will be the first US commercial customer for its new battery-powered eCanter truck.

The parent company of Mercedes-Benz also said it will expand its electric truck production as lower cost, longer-range batteries become available within two to three years.

At an event in Manhattan's fashionable Soho neighbourhood, Daimler unit unveiled its new Fuso eCanter, an electric light-duty truck produced under the Mitsubishi Fuso brand. The hauler has a range of 60 to 80 miles (97 to 129 km) between charges, depending on body, load and usage, Marc Llistosella, chief executive officer of Mitsubishi Fuso Truck and Bus Corp, said Thursday.

''If you want to change some paradigms, you need more than yourself - you need stakeholders, you need support,'' Llistosella said before the truck was unveiled amid recordings of chirping birds and a machine blowing soap bubbles. ''Electrification of trucks is important to our society.''

Manufacturers such as Daimler and Navistar International Corp, as well as electric car maker Tesla Inc and a host of other new entrants, are working overtime to overcome the challenges of substituting batteries for diesel engines in medium- and heavy-duty trucks as regulators crack down on carbon dioxide and soot pollution.

''The game has started,'' Llistosella, who is in effect Daimler Trucks' Asia chief, told Reuters in an interview on Thursday.

Daimler appears to have stolen a march on electric motor specialist Tesla, as Elon Musk said on Wednesday that his firm's first heavy-duty semi would be unveiled next month. (See: Musk all set to unveil heavy-duty Tesla truck next month)

The Fuso eCanter is a relatively small urban delivery truck, but Llistosella said larger, Class 7 electric trucks are coming and hinted that Daimler will show a larger electric truck at the Tokyo Motor Show next month.

Daimler said at the event in New York that UPS will deploy three of the eCanter trucks, while four New York-based non-profit organisations will get a total of eight electric trucks. The trucks have a range of about 100 km between charges.

Daimler is leasing the trucks to UPS, Llistosella said, because within about two years ''we know there will be a next level of technology'' that will produce batteries with longer range, lower cost and lower weight.

Battery costs that are currently about $180 to $200 a kilowatt-hour could drop to about $100 a kilowatt-hour, Llistosella said. ''This is the main lever'' to move electric commercial trucks to higher sales volumes, he said.

Daimler is limiting sales of the eCanter to about 500 vehicles for the first two years of production, in anticipation of the improved batteries, Llistosella said. ''The market demand is much higher.''

Daimler's Mitsubishi Fuso unit began building eCanter trucks at factories in Portugal and Japan earlier this year.

Daimler is joining a growing crowd. Diesel-engine maker Cummins Inc beat Tesla Inc to the punch last month with a fully electric ''urban hauler'' concept, which has a projected range of about 100 miles. Tesla has met with states about testing out autonomous-driving features. Paccar Inc and Navistar International Corp are working on alternative-fuel strategies and driver-assistance systems to push trucking technology forward.

Llistosella said Daimler is ahead of the competition because the Fuso eCanter is the first electric truck to be mass-produced. Fuso will deliver 500 trucks within the next two years, then make more than 10,000 in 2019, he said. UPS agreed to lease three trucks and municipalities in Portugal and Japan that are also customers.

Daimler is offering two-year leases for about $1,000 a month, a price Llistosella said has dropped 65 per cent from the first prototype of the truck built in 2014. The company is choosing to lease rather than sell so that it can offer customers upgrades as battery costs drop.

The eCanter is more expensive than a diesel truck and offers about 10 per cent less maximum payload, Llistosella said. Drivers can offset the premium in about two and a half to three years thanks to lower maintenance and fuel costs.

Light-duty trucks make sense in urban environments for garbage routes and deliveries because the range needed rarely exceeds 100 miles and trucks return to charge in the same place every night, said Lee Klaskow, a transportation analyst with Bloomberg Intelligence.

''The reality is the technology isn't there to support anything else,'' he said.

Daimler, which is working on autonomous-driving technology for its trucks, will introduce its own long-haul semi concept at the Tokyo Motor Show in October, Llistosella said.

''Right now, it's not technically possible, but it will be in only a couple of years,'' he said. ''It's not a question of if, it's just a question of when.''