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All Business. No Boundaries. The DHL Supply Chain Podcast
Welcome to All Business. No Boundaries, a collection of supply chain stories by DHL Supply Chain, the North American leader in contract logistics. This is a place for in-depth discussions on the supply chain challenges keeping you up at night. We’re breaking beyond the boundaries that are limiting your supply chain.
All Business. No Boundaries. The DHL Supply Chain Podcast
Super Charge Your Supply Chain: Removing Barriers to Electrification
In this episode, we sit down with ABB to discuss the future of electric fleets, the benefits electric trucks could provide, and how to overcome barriers to implementation.
Special Guests:
- Devin Sclater, Business Development Manager, ABB
- Stephan Schablinski, Vice President of GoGreen, DHL Supply Chain
Welcome to All Business No Boundaries, a collection of supply chain stories by D Hhl Supply Chain, the North American leader in contract logistics. I'm your host, will Hayward. This is a place for in-depth discussions on the supply chain, challenges keeping you up at night. We're breaking beyond the boundaries that are limiting your supply chain. Today's episode is supercharge your supply chain, eliminating barriers to electrification. Our guests are Devin Slaughter, business Development Manager at a bbb and Stephan Linsky, vice President of Go Green at d Hhl Supply Chain. Let's dive in. All right, well, welcome to you both. Thanks a lot for being here today. I've been looking forward to this discussion. W I'd like to start by allowing you to introduce yourselves, who you are, what your role is, what your organization is. Devin, why don't we start with you?
Speaker 2:Um, sure. My name is Devin Slaughter. Hi. I am the Fleet Business Development Manager for A B E Mobility Inc in the United States. A BBB manufacturer's electric vehicle Chargers. Elise, the A B B E Mobility side.
Speaker 1:Okay. And Stefan?
Speaker 3:Yeah. My name is Stephan Linsky. I'm in charge of DHL Supply Chains decarbonization program, which we also call Go Green here in North America. I've been with DHL for about 20 years and spent the last 15 years in the Go Green Arena in different regions and countries, and I've been, um, moving with my family to Columbus, Ohio about eight or nine months ago.
Speaker 1:Okay, good. I wanna come back to that because Id be interested in, as we talk about sort of the green implications of electrification, your perspective from your experience in Europe. Let's start with some definition stuff. So the subject of the podcast today is the electrification of fleets. So if you could just tell us about fleets and then electrification. What is that process? Devin, why don't you go first?
Speaker 2:Absolutely. So personally, I would consider fleet two or more vehicles, especially if those vehicles perform or, or assist with some sort of work throughout the day or have their employees on, um, some sort of shift schedule where the next shift is reliant on that vehicle to be there, ready to go, fueled, loaded, whatever the work profile might be. And then as far as electrification that covers, um, converting those vehicles from gas or diesel to electric, substituting electric vehicle models for the vehicles already in place and developing the charging infrastructure needed and the charging timeframe needed for each individual vehicle.
Speaker 1:Okay, got it. S Stephan, anything that you would add there?
Speaker 3:Yeah. Um, for us in North America, we are operating a fleet of about 1200 trucks. These are mainly Class seven, class eight trucks. Um, some also call them semi A trucks. These are big trucks, um, that run over the roads across North America. And our plan is to switch some of these trucks over to electric. Most of the trucks that we operate at the moment are running on diesel, and the goal that we have to have 30 or more percent run on electricity in the future.
Speaker 1:How'd you arrive at the 30% number?
Speaker 3:Well, in our case, uh, transport constitutes the lion share of our carbon emissions and in order to meet our decarbonization targets, so the number that we want to achieve and 2030, we need to at least have 30% of these trucks beyond zero emissions.
Speaker 1:Okay. Okay. So D hhl and A B B. What is the nature of the relationship today? So why are we together on this podcast, Devin?
Speaker 2:So, with D Hhl looking to electrify vehicles, a, B B would love to be a partner, whether that's through providing the charging infrastructure full of providing any kind of fleet advisory. We're also working with different companies for fleet software. So really anywhere that we can, we can help D Hhl with their electrification adoption.
Speaker 1:Okay. And so Devin, maybe if you could spend a minute just kind of explaining what it is that a b B does in this area. I heard, you know, there's sort of a thing around infrastructure, there's a thing around advisory services. What is the sort of range of services that you offer to your customers?
Speaker 2:So, abb e mobility manufacturers, mainly DC fast chargers, ranging at pretty large range of kilowatt strength so that there's a charger that fits any need, whether it's, you know, you have a couple of trucks that are at super strict their time windows, or you've got transit buses that have to be a certain place at a certain time and be back on the road again to pick up more customers. So we want to go beyond just providing that infrastructure, especially in the fleet space where there are a lot of logistics. I spent a couple of years at a fuel company and we sold the fuel, but then working with a lot of these different fleets, I'm really keen to understand how their work profiles worked and how they needed a little bit different logistics depending on what they were delivering, what their work profile looked like. Uh, so ABB wants to kind of bring some advisory to these companies, especially those that might not be super familiar with electric vehicles and how they function. We wanna help abolish some of the myths that are out there about electrifying, and then also help a fleet manager take a look at the work that needs to get done every day and develop a strategy to do that. With electric vehicles, we have some software options that will show what chargers are available, what chargers are in use, what chargers might be down for whatever reason, it'll show the charging data for the different vehicles of how quickly they're charging. We're also working to help with replacement. So say you have, you know, four pickup trucks in your fleet, looking at the work that they do, do they need to be pickup trucks? Could we substitute maybe just a different passenger vehicle? Or if they do have to be that pickup truck, what model of pickup truck works for them through a place with an electric model? So going beyond just, you know, here's a charger, good luck, have fun, good luck with your fleet. You know, we want to really be partners with our customers and help them help take a lot of the fear out of electrifying because it is, it's a very different world. It's still pretty new for most folks. So yeah, we really wanna provide any bit of help that we can to sort of ease that transition.
Speaker 1:Good. So I wanna spend a couple minutes there, and it's a question for both of you. Devin, you, I think described it as the myths around electrification. What are some of those things? What are some of the top of mind considerations that folks should be thinking about as they think about transitioning to more of an electrified fleet?
Speaker 2:So one of the, the big ones I think is range anxiety. We see it all across different customer types. Essentially, if you have a vehicle that this is going to not include over the road just for a minute, but if you have a fleet of vehicles where they come back every night, either they sit overnight or they sit during the day, or they sit for a decent amount of time, chances are that is a fleet that can be electrified without a lot of disruption. You know, it's, if you have a, if, if you really look at the distance that your vehicles are traveling every day, if it's under, you know, 350 miles, that range anxiety kind of starts to evaporate because that's about your mileage on some of these medium heavy duty vehicles that we would replace it with. I think another really big myth is the cost. Well, you know, I'll be completely honest, yes, it's, it's expensive upfront between putting in the infrastructure and also buying the vehicles. They are more expensive than gas or diesel vehicles. However, if you look at the cost over time, electricity is a lot cheaper than fuel. These vehicles require a lot less maintenance because there are less parts. It's that simple. Brake maintenance is not as much because it's not as frequent because of regenerative braking. So there are a lot of different factors that go into it, where over time it is less expensive to, to operate these vehicles. And that's not just me saying that because I put together a model in my head, but it's been, it's been proven with pretty much every fleet that has electrified from, you know, light duty, smaller vehicles all the way through transit vehicles. Some of those savings are pretty substantial and pay that, that delta between a diesel bus and an electric bus pretty quickly.
Speaker 1:Hmm hmm. So, Stephen, from DHL's standpoint, I mean, if we've got 1200 trucks and you want to get to 30, that's 400 ish. So, you know, what's the path to get there? How do you break that down into the easiest to get first and, you know, how do you sell that case to both customers and internally?
Speaker 3:Right. I think it starts with understanding your fleet first. Um, when we embarked on this topic about nine or 12 months ago, the very first thing that we did is really to understand our operations and then also to recognize that electric trucks are very different than diesel trucks. If you think about it, diesel vehicles happen around for, for a century, I would say. And, and the whole ecosystem has been, has been built over decades, so to speak. So if, if one buys a diesel truck today, one does not need to think hard about fueling availability. I mean, diesel fuel stations are everywhere across the country. The same is true for service capabilities. So if service and maintenance for diesel trucks, most of that needs to be established and be built for electric vehicles. And that's something that is important to, to understand. So that one makes a very informed decision and not a rush, a rush decision to go into electric vehicles. And then in the end of the day fails. I think what was important for us to not listen too much about the, the myth that is out there, but also some of the, uh, messages that come from the industry that says, okay, a, a electric truck can only go 200 miles compared to a diesel truck that can go probably thousand miles on a single fill. I think the comparison between a diesel truck and electric truck is not what's important. It's more important to understand how the electric vehicle with the range of roughly 200 miles on a single charge fits or does not fit the operational requirements. That's to us the more important comparison. So what we did was to really walk through our data and walk through our fleet to understand where are the operations in the country for who the constraints of an electric vehicle as far as mileage, as far as downtime to charge the vehicle is not a constraint because their daily mileage is below 200 miles and the truck comes back after the shift back to the location where it started the shift so that it has enough time and downtime to charge the vehicle at that location. So basically we work through this list and identified operations and fleets that meet the electric vehicle profile and then started to build a case for these operations.
Speaker 1:And where are you in terms of implementation of your plan? How many trucks are out on the road? How many do you have planned in the next couple years?
Speaker 3:Right, so earlier this year we have cut an order for the first batch of vehicles that will arrive early next year. And from then on, we will ramp up from the number that we receive next year to the 400 of one 50 that we will see in 2030. But the journey is not a journey between us and the vehicle manufacturers, but it's actually the entire ecosystem that we build and partners that we are working with because alongside the trucks, we need to build the charging infrastructure at our sites and the customer sites. We also need to make sure that the facilities that house these charges have enough power to actually empower the charges, the charges that then charge the vehicles, but also work with the vehicle manufacturers to make sure that close to the operations, we have actually a shop that is able to service the electric vehicles because all of this needs to be in place to then provide a seamless operations to our customers. That's very important. But I think the first batch of vehicles that will come in will be for us to really learn. We are still at the very beginning of a learning curve to learn how to make electric vehicles work in the future and how to bring them to scale over the next eight years until we have reached the 30%. That's our aim.
Speaker 1:Right. So Devin, you know, in your experience, where would Stephan's answer or d hhl is on the evolution path? Is that sort of what you're seeing commonly in the market? Is DHL leading behind? What's your assessment?
Speaker 2:Personally? I think any company that is taking electrification so seriously is, is the head. Um, but, uh, but yeah, I mean it is, it is what we're seeing, you know, companies that are really serious about it are really delving into understanding electric vehicles, understanding infrastructure, working with their utility, that's a big one. And just sort of understanding what this is going to mean. You know, it's a very different vehicle to the electric truck. And being prepared for that is really the best that we can do. Being educated and working with, with partners. You know, I, I know a lot of companies have probably never spoken to their utility as someone who used to work at a utility. I understand that, but those conversations are going to have to happen. I mean, DHL is definitely a leader in this space and we're seeing a lot of companies kind of do a lot of similar things.
Speaker 1:Yeah. So from a BBB standpoint, the ecosystem that Stephan described that needs to be in place, where is a BBB sort of planting a flag? And then where are you linking up with other partners to provide the necessary pieces? You mentioned utility, which I'd be interested in understanding a little bit more about what that looks like. But, you know, maintenance, all those other factors that the diesel infrastructure's been there for a long time. How is ABB kind of driving the action on the electrification front?
Speaker 2:So we have a number of employees who came from the gas and diesel world, which I think is really important because they, and and myself included, understand how a lot of that works. Whether we're talking about convenience stores, fleet electrification, working with the utility, you know, we have folks who've already kind of been there, done that on the diesel gas side, so they can kind of come in and help translate, for lack of a better phrase, all of that into electrification. And ABB has done pretty, in somewhat my opinion, a pretty amazing job in hiring service folks to help with that fear of having you go from decently reliable delivery of diesel and you know it's going to work it's diesel fuel, you put it in your truck and you go, whereas, you know, the charger brings some of the logistics home to the owner of the charger. So ABB is really working to hire a dynamic force of individuals who can service those chargers, whether in person or remotely, and also train employees of other companies to work on those chargers so that, you know, D H L or whomever can have in-house folks trained by A, B B to work on a b b equipment to help bridge the gap if something should go wrong with a charger. And then, you know, like you mentioned the utilities, we have some folks on our team who are business development managers like myself, but they work with the utilities and both of them have pretty extensive experience working with utilities and also working on electrification programs with the utilities as well. So they really understand the lingo, you know, understanding when you need to put a transformer in about how much it's gonna cost the utility, what the utility programs are. It's another important piece because there are a lot of utilities that are, that have some pretty great programs available for their customers. I mean, not just residential customers. Oh, we also have business development in that convenience store or public charger price too, which is also important because as I said before, you know, I wasn't, um, talking about over the road, well, we have to talk about over the road, you know, they're going to need fast chargers at truck stops, you know, for everybody. Ones that have showers and bathrooms and food so that, you know, that truck can sit for a little while and charge while the driver does what he needs to take care of during the day or at night. A, b B is really trying to understand the space. And then also, again, partnerships are super important. We're working with some of those larger convenience store owners on, you know, just the best, the best way to do this.
Speaker 1:Yeah. Gotcha. How many, and you may not know off the top of your head, how many chargers does a b B have installed today?
Speaker 2:So in North America, there are over 6,000 chargers and then globally 680,000 chargers, including 30,000 DC fast chargers in over 88 countries.
Speaker 1:Okay. So you did know it off the top of your head. That's okay.<laugh>, um, Stefan, I I wanna get back to the, to the Europe thing. So how would you compare the markets North America versus Europe with respect to truck electrification?
Speaker 3:Mm-hmm.<affirmative>, if I look at ourselves, Dodger post dhl, the entire group, we operate about 120,000 vehicles overall. And I think at the moment we have about 25,000 or so electrified. Most of those electric vehicles are running in Europe, and these are vans, so light duty vehicles and, and the light duty vehicles segment. And that's not only bound to the geography, but the light duty segment is years ahead of the heavy duty. So, um, I remember that, uh, when we started looking into electrifying the, uh, light duty vehicles that we used for, um, final, my deliveries back in 2013, 14, it reminds me of what we are looking at at the moment as far as heavy duty trucks are concerned. So only very few OEMs or truck manufacturers are providing electric options. The market of charging facilities was at the infancy. And if I look at this now with 25,000, uh, electric vehicles in the light duty space in Deutsche Post DHL in Europe alone, I mean, that has been an amazing and very fast development. And, and I can see, and I hope that this will happen also in the, in the heavy duty segment. Now, I would say that in a lucky position as a, as a group that works across many continents and many different types of businesses, that we were able to learn from many different transport types. So we have these more than 20,000 electric vehicles, light duty running in Europe and most of them in Europe. And we were able to learn and how to learn how to actually implement, um, electric vehicles, how to get the entire infrastructure and ecosystem built. And what we took from there, when we took it over to North America, it was to start with vehicles where, where we don't have this, uh, range anxiety that that was mentioned earlier. And this was the segment of, uh, yard trucks. So basically class seven or class eight trucks that not operate on the road typically, but inside our warehouse yards. And these trucks are, are moving trailers around the yards all day long, some 24 hours, but if they don't have anything, then range anxiety because they, they work very close to the warehouse where they can charge the vehicle or the battery anytime they want during the lunch break or any break, uh, in between. So we started the electrifying our trucks to just learn what it takes to make big trucks electric, so to speak. And that learning from the yard truck journey gave us a lot of insights that we can now take on the road, so to speak, onto the class seven and class eight heavy duty segment.
Speaker 1:Okay. Gotcha. Just a very practical question, how long does it take to recharge one of these things?
Speaker 3:This is a question that is very frequently asked to me. So it really depends on the size of the charger. So I typically say anything between, let's say one hour to eight hours, but it really depends on the size of the charger. And I think this is where this informed decision that I meant earlier is very important because the, the quicker you charge the battery, the bigger charger is, and with that also the cost of the charger and the charging infrastructure and the power that you need to bring to the side. So I'm always saying if the trunk comes back and is resting overnight, so to speak, and the truck is sitting there for eight, 10 or 12 hours, there's no real reason to go for a huge charger that is also more costly, but you can actually start with a hundred kilowatt charger and then charge the battery, the class seven, eight truck battery, then over seven or eight hours instead of 30 minutes or 60 minutes.
Speaker 1:Yeah. So Devin, the infrastructure that you described, the 6,000 chargers, what's their rating or how, what's your target for, um, recharge time?
Speaker 2:It depends on which charger it is. I don't have a breakout of how many of each charger we have deployed, but unofficially I would say, you know, our Terra series is probably one of the more popular ones, especially with public charging and probably about 15 to minutes to an hour to charge a car and a bus or truck would be at about one to four hours. However, you know, if a fleet user needs something faster or something slower, we have options for that as well. We can go as fast as 5, 10, 15 minutes for a bus and then, you know, also some larger charge times of eight to 12 hours.
Speaker 1:Right. Okay, good, thanks. Our last episode we had Volvo trucks on and we were talking about automation in trucks, so driverless vehicles, basically. So that's a big trend I know in the automotive world. And then this electrification is another one. How do you two see those two trends coming together? Because it sounded like with Volvo they're working on both, but they seem to be working sort of independent of one another and they think at some point they'll come together. But I would just be curious from the electrification side how you see that working out. Stefan, do you have a perspective there?
Speaker 3:Yeah, in my opinion, I would agree that these two trends can work independently. They can coexist. I don't see an absolute need for these two technologies to come together From that perspective, I think it makes a lot of sense for these two trends to merge, so to speak. But I don't see this happening in the near future, to be honest.
Speaker 1:Mm-hmm.<affirmative>, how about you, Devin?
Speaker 2:Yeah, I mean, I, I honestly do agree with that. I don't have too much to add.
Speaker 1:Okay. So, you know, kind of putting on your X-ray vision or future vision, what's the world look like from an electrification standpoint in 2030? I know that that's a d hhl target, but you know, more broadly than just the percentage of trucks, Stefan, how do you see, um, things shaking out?
Speaker 3:I truly believe that the future will be electric, whether this is a battery electric truck or a hydrogen electric truck. But I, I truly believe that the electrification is something that's unstoppable. And I'm believing this because the benefits of electric transport are so compelling. And it really came to me when I, again, recently stood in front of an electric vehicle and side by side was a diesel truck. And, and you can really see with almost all your senses the difference between a diesel truck and the electric truck. You can see it, you can hear it, you can feel it, and you can almost smell it, so to speak, because the electric truck, you know, it's, it's quiet and it's nice for the driver. It's very positive for the people who are driving the truck because they also say that there's less fatigue, they're less tired because there's also less vibration, there's less distraction. But also when you open the hood of the truck, you see the difference because it doesn't create any heat. The electric truck, no vibration, no sound. So it's really something that every time I see the difference between these two, it blows my mind why we haven't embarked on this earlier. Just purely from an energy conservation standpoint. Earlier this year we ran a six month trial in Ontario, California of a fully electric class a truck. And we compared diesel consumption of the diesel truck that is running on that exact same route with the exact same product and the exact same schedule with the electric truck that we use for the six months. And we compare the consumption patterns of the diesel versus the electricity. And if we convert it, if you convert both into kilowatt hours, which is then the unit for energy, you'll figure out that the electric truck for the exact same business consumes half or less than half of what the diesel truck consumes, which is just amazing from an energy consumption perspective. Of course, that also translate into, into lower emissions. So there are no CO2 emissions coming out of tailpipe. There are no NOx emissions. So nitrox cides emissions, which is very positive for the people that live close by the major transport routes or live close by, uh, logistics facilities. I think that the benefits are so overwhelming that I'm absolutely convinced that the future will be electric.
Speaker 1:Hmm. Yeah, that's a really interesting stat, but how about you, Devin? How do you see it?
Speaker 2:I do agree that the future will be electric for all the, the reasons that, um, SFA noted. But we also, I think need to keep in mind that it's going to be an all hands on deck type of situation. And I think that, you know, ABB and d Hhl are on the right track here in conversing with each other and talking to fleet owners and the utilities, whether it's a co-op or an investor owned or municipal utility, we have to kind of keep everybody involved in the process. And it needs to be focused on a lot of education as well, because I don't think it should necessarily be, you know, shoved on folks who aren't ready for it yet or don't really fully understand it because that's where we're going to get a lot of pushback, I think. Mm-hmm.<affirmative>. Um, whereas if we approach it as an educational sort of thing and we have as many resources available as we can for fleet owners and anybody trying to electrify, then it becomes, it becomes a lot easier. It becomes a lot less about do this because I said so, and it really turns into do this because it's more beneficial to you and make the case to these customers, make the case to the utilities who might not be on board with electrification yet and enter it responsibly so that we don't have power shortage issues or you know, people just get kind of jaded by the idea. We have to be responsible about it and we have to continue to focus on logistics and what we can do and how we can coordinate with all of the folks involved.
Speaker 1:Okay. So Devin, if I'm a fleet owner and I have a fully diesel fleet today, and I wanna think about how do I start to electrify it, what are the kind of practical considerations that I should have on my mind to start down that path?
Speaker 2:So probably the first thing to do would be to reach out to a company like ABB or your utility who might be able to connect you with abb. You can email me, I'd be happy to talk to you. But what's really important right now is there are some supply chain issues with getting chargers to your site. So as we've seen supply chain issues with pretty much everything, so the sooner the better, you know, lead times are, are not spectacular across the board for any company. So we'd really like to start the conversation early and get it moving that way we don't have a mismatch in when your vehicle gets delivered and when your charger gets delivered. You know, abb, we're doing a lot of things on our end to make sure that these chargers work correctly when they get to you, or working on interoperability to make sure the vehicles and chargers are pretested and validated together. Especially now that a lot of new vehicle models are coming out. You know, like I said, we're also using very specifically trained installers. The way that you know, you can get started is the sooner the better. Speak to people who know what they're talking about and then, uh, and get those orders in as quickly as you can.
Speaker 1:Stephan, for dhl, you said you've got some trucks on order to put on the road for early next year. How are the infrastructure pieces coming along? Are you seeing some of these supply issues that Devin outlined?
Speaker 3:Yes, I can only agree to what Devin said, be aware of the time that it takes to introduce electric, uh, vehicles and the entire infrastructure when we approached our facilities. Uh, it takes time to really understand, you know, the utility contract, the amount of amps that the site has received from the utility provider and so on and so forth. So it takes a lot of time that needs to be considered, but also as, as one embarks on the electrification journey, my advice is don't start with extreme cases, so to speak, where the truck is running 500 miles a day and you try to find a solution for that. Or where the truck has no downtime or little downtime, not enough downtime to recharge the battery. So start with those trucks that go only a hundred or 200 miles a day that have enough time to get them charged overnight. And don't try to convert the entire fleet that you operate at one specific business. Maybe start with one or two trucks and don't try to convert all the trucks to electric. So that would be my advice, to have a positive experience with your journey. Mm-hmm.
Speaker 1:<affirmative>. Yeah, that all makes sense. Yeah. Well, it sounds like an exciting time to be in the field, that both of you are a lot of good challenges ahead, but great opportunities as well. So I just wanna thank you both for joining me today and, and having this conversation. I look forward to seeing how all of this unfolds in the coming years. We'll be eager to see Stefan if, uh, d Hhl can make its target and how quickly we get there. If you enjoyed the conversation today, please share it with a friend and rate us on Apple Podcasts. You can find us online at dhhl.com/all business, no boundaries, and follow us on LinkedIn and Twitter at at dhhl supply chain. We'll see you next time.