FedEx Places First Order for 15 Workhorse W56 Step Vans to Grow Zero-Tailpipe Emission Fleet

Rhea-AI Summary

Workhorse Group Inc. (Nasdaq: WKHS) has announced that FedEx (NYSE: FDX) has placed an order for 15 W56 step vans to be delivered in 2024. This order follows a successful demonstration where the W56 met FedEx's operational requirements. The W56 achieved an impressive 31 MPGe during real-world testing, significantly outperforming the national average of 7 MPG for delivery trucks. This purchase is estimated to avoid 607 metric tons of tailpipe emissions annually, supporting FedEx's goal of achieving carbon-neutral global operations by 2040.

Workhorse CEO Rick Dauch expressed enthusiasm about the collaboration, highlighting the company's ability to build complete vehicles as a key differentiator. The W56 step van is designed for last-mile delivery operations, featuring an efficient eAxle electric drivetrain and extended range with regenerative braking.

Positive

• FedEx placed an order for 15 Workhorse W56 step vans for 2024 delivery
• W56 step van achieved 31 MPGe in real-world testing, significantly outperforming the 7 MPG national average
• The order is estimated to avoid 607 metric tons of tailpipe emissions annually
• Successful demonstration of W56 meeting FedEx's operational requirements
• Workhorse's ability to build complete vehicles differentiates it from competitors

Negative

• None.

Insights

Financial Analyst

FedEx's order of 15 Workhorse W56 step vans marks a significant milestone for Workhorse Group. While the order size is modest, it represents a strategic entry into a major logistics player's fleet. The $1.5-2 million estimated order value (based on typical EV van pricing) may not dramatically impact Workhorse's financials immediately, but it opens doors for potential larger orders. The W56's impressive 31 MPGe efficiency could translate to substantial operational cost savings for FedEx, potentially driving further adoption. Investors should monitor whether this leads to follow-on orders or attracts interest from other major logistics companies, which could significantly boost Workhorse's revenue and market position in the competitive EV commercial vehicle space.

Environmental Impact Specialist

The adoption of 15 W56 step vans by FedEx represents a small but meaningful step towards reducing carbon emissions in the logistics sector. The estimated 607 metric tons of avoided tailpipe emissions annually is a positive environmental impact, albeit on a scale given FedEx's vast fleet. The 31 MPGe efficiency of the W56, compared to the 7 MPG average for delivery trucks, showcases significant potential for larger-scale emission reductions if widely adopted. This order aligns with FedEx's 2040 carbon neutrality goal, setting a precedent for the industry. However, the true environmental benefit will depend on the energy sources used to charge these vehicles and the scale of future electric vehicle adoption by FedEx and its competitors.

Automotive Industry Analyst

Workhorse's success in securing this FedEx order demonstrates its competitive edge in the commercial EV market. The W56's performance in meeting FedEx's operational requirements is a strong validation of its technology and design. Workhorse's ability to build complete vehicles in-house gives it a unique advantage over competitors who may only provide chassis or powertrains. This could lead to faster order fulfillment and potentially higher margins. However, the relatively small order size of 15 units suggests FedEx is still in a testing phase. The EV commercial vehicle market is highly competitive, with established automakers and startups vying for market share. Workhorse will need to leverage this win to secure larger orders and establish itself as a preferred supplier to major logistics companies to achieve significant market penetration.

CINCINNATI, Sept. 09, 2024 (GLOBE NEWSWIRE) -- Workhorse Group Inc. (Nasdaq: WKHS) (“Workhorse” or “the Company”), an American technology company focused on pioneering the transition to zero-emission commercial vehicles, today announced that FedEx (NYSE: FDX) has issued a purchase order for 15 W56 step vans to be delivered in 2024. This milestone order follows a successful demonstration in which the Workhorse W56 step van met FedEx operation duty cycle requirements.

The addition of these 15 W56 step vans will support the FedEx goal to achieve carbon neutral global operations by 2040—underscoring the company’s phased approach to replacing older vehicle technologies with new, zero tailpipe-emission solutions. During real-world delivery route testing, the W56 achieved an impressive 31 MPGe. Compared to the national average fuel economy of 7 MPG for delivery trucks, this demonstrates significantly lower energy consumption per mile. Based on an average of 31,875 miles driven per vehicle per year, the purchase enables the avoidance of an estimated 607 metric tons of tailpipe emissions annually.¹

“FedEx is cultivating a strong roster of electric vehicle models that can meet the demands of our network,” said Pat Donlon, Vice President, Global Vehicles, FedEx. “In joining our fleet, the electric Workhorse W56 will be part of our story as we aim to transition our global parcel pickup and delivery fleet to all zero-tailpipe emissions vehicles by 2040.”

Rick Dauch, Workhorse CEO, expressed his enthusiasm about the collaboration: “We are thrilled to be selected by FedEx and support their sustainability goals. This milestone demonstrates our highly efficient and high-quality EV chassis and body along with our excellent engineering, field support, upfit and operational capabilities. Our ability to build complete vehicles differentiates us from our competitors and enables us to quickly fulfill orders. We look forward to working with FedEx as they transition to electric last-mile delivery vehicles.”

The Workhorse W56 step van is meticulously engineered to meet the demanding needs of commercial last-mile delivery operations. With its efficient eAxle electric drivetrain and extended range aided by highly efficient regenerative braking, the W56 delivers superior efficiency, lower operational costs, and a reduced environmental footprint. This makes it perfectly suited for stop-and-go delivery routes and an ideal choice for last-mile delivery.

For more information about the W56 step van and Workhorse’s portfolio of Class 4-6 battery-electric vehicles, visit www.workhorse.com.

About Workhorse Group Inc.
Workhorse is a technology company focused on providing ground-based electric vehicles to the last-mile delivery sector. As an American original equipment manufacturer, we design and build high performance, battery-electric trucks. Workhorse also develops cloud-based, real-time telematics performance monitoring systems that are fully integrated with our vehicles and enable fleet operators to optimize energy and route efficiency. All Workhorse vehicles are designed to make the movement of people and goods more efficient and less harmful to the environment. For additional information visit workhorse.com.

Forward Looking Statements

The discussions in this press release contain forward-looking statements reflecting our current expectations that involve risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. When used in this press release, the words “anticipate,” “expect,” “plan,” “believe,” “seek,” “estimate,” and similar expressions are intended to identify forward-looking statements and relate to future periods. These are statements that involve substantial risks and uncertainties, including our ability to timely deliver the W56 step vans ordered by FedEx, conditions to delivery and acceptance applicable to the purchase order, the expected delivery date and the expected performance of W56 step van, including the expected MPG and the estimated reduction in tailpipe emissions. Forward-looking statements are statements that are not historical facts and speak only as of the date hereof. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions, or circumstances on which any such statement is based, except as required by law.

Media Contact:
Aaron Palash / Greg Klassen
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449

Investor Relations Contact:
Matt Glover and Tom Colton
Gateway Group
949-574-3860
WKHS@gateway-grp.com

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¹ Based on EPA estimates

FAQ

How many Workhorse W56 step vans did FedEx order from WKHS?

FedEx placed an order for 15 Workhorse W56 step vans to be delivered in 2024.

What fuel efficiency did the Workhorse W56 step van achieve in real-world testing for WKHS?

The Workhorse W56 step van achieved 31 MPGe in real-world delivery route testing.

How much tailpipe emissions are estimated to be avoided annually with FedEx's order of WKHS vehicles?

The purchase of 15 Workhorse W56 step vans is estimated to avoid 607 metric tons of tailpipe emissions annually.

What is FedEx's goal for transitioning to zero-emission vehicles, and how does the WKHS order support it?

FedEx aims to transition its global parcel pickup and delivery fleet to all zero-tailpipe emissions vehicles by 2040. The Workhorse W56 order supports this goal by adding zero-emission vehicles to their fleet.