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Illustration: Eniola Odetunde/Axios

General Motors is launching a new business unit devoted to electrifying the goods delivery market and says package giant FedEx will be the first customer.

Why it matters: Big automakers and startups alike see a huge opportunity.

  • GM said it sees an $850 billion U.S. market for "parcel, food delivery and reverse logistics" by the mid-2020s.
  • "E-commerce already was on a tremendous growth trajectory and COVID has just taken that to the next level," Pam Fletcher, GM's vice president of global innovation, told reporters yesterday.

Driving the news: GM's new BrightDrop unit provides an "ecosystem of electric first-to-last-mile products, software and services" for delivery and logistics companies, the company said.

  • A key piece is a new electric delivery vehicle arriving late this year that GM says will have a range of 250 miles per charge.
  • There's also an "electric pallet" to help move goods over short distances, as well as software products to help customers in areas like ensuring the most efficient delivery routes.

The big picture: GM is plunging into an increasingly competitive market for electric delivery vans and other commercial vehicles with a plug.

  • Amazon has invested heavily in the EV startup Rivian and plans to have as many as 100,000 of its electric delivery vehicles on the roads by 2030.
  • Ford unveiled its E-Transit van last month as it hopes to defend its current market position in the commercial vehicle market.
  • UPS is among the deep-pocketed investors in the U.K.-based startup Arrival and plans to buy lots of its vans.
  • Workhorse Group, another EV startup, last week said the trucking and logistics company Pride Group Enterprises has ordered 6,320 of its delivery vehicles.
  • That's not even a full list!

The intrigue: GM is pursuing multiple strategies for deploying its much-touted Ultium battery propulsion system at a time of upheaval in the auto industry.

  • The new business-to-business line is coming as GM rolls out a bunch of vehicles for the private consumer market, too.

What they're saying: GM officials say the idea of BrightDrop is that the products and services together form a one-stop-shop for customers — providing everything from fleet maintenance to route optimization.

  • "That's the big 'a-ha' here," said Fletcher said, touting the notion of an ecosystem of hardware, software and services. "But we also have a great van," she added.

What's next: Fletcher said FedEx plans to take delivery of its first 500 vans by the end of this year. She also said GM has lined up commitments from other customers she did not name.

Go deeper

Jan 29, 2021 - Podcasts

When investing goes viral

You've likely heard the headlines this week about the stock market mania around GameStop. But this isn't just about the stock market. It's a kind of populist uprising borne of the Internet.

  • Plus, what’s behind GM’s big electric vehicle announcement.
  • And, the new Wild West is in outer space.
Ben Geman, author of Generate
31 mins ago - Energy & Environment

Carbon emissions are roaring back from COVID-19

Expand chart
Data: IEA Global Energy Review 2021; Chart: Axios Visuals

Global energy-related carbon emissions will surge this year as coal, oil and natural gas consumption return from the pandemic that caused an unprecedented emissions decline, the International Energy Agency estimated Tuesday.

Why it matters: The projected rise of nearly 5% would be the largest since the "carbon intensive" recovery from the financial crisis over a decade ago, IEA said, putting emissions just below their 2019 peak.

53 mins ago - Axios Twin Cities

Jurors resume deliberations as the nation awaits Chauvin verdict

Protesters outside Hennepin County Government Center on the day of closing arguments. Photo: Christopher Mark Juhn/Anadolu Agency via Getty Images

Jurors in the Derek Chauvin trial resume deliberations Tuesday morning as the nation waits for a verdict.

The latest: The 12 jurors met behind closed doors for about three hours Monday before breaking for the night at 7pm.

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