Consultant Insight: FedEx and UPS emphasize the importance of sustainability

A growing number of logistics providers are incorporating sustainability into their daily operations and publishing annual reports on goals and achievements. Now, however, more companies are stepping it up a notch and establishing timelines to achieve carbon neutrality. [caption id="attachment_69752" align="alignright" width="298"] Cathy Roberson, Cargo Facts Consulting senior consultant and Air Cargo World columnist[/caption] FedEx announced on March 3 that it plans to be carbon-neutral in its global operations by 2040. To reach this goal, FedEx has earmarked $2 billion to invest in vehicle electrification, sustainable energy and carbon sequestration. As part of its goal, FedEx will replace its parcel pickup and delivery (PUD) fleet with zero-emission electric vehicles (EVs). In January, GM announced that FedEx Express would be the first customer of its new business, BrightDrop, centered around EVs. FedEx will receive 500 of the company’s electric light commercial vehicle, the EV600, later this year. In 2018, FedEx Express announced it would add 1,000 all-electric delivery vehicles manufactured in China for operation in California. FedEx has more than 200,000 motorized vehicles in its fleet. As of fiscal year 2019 (period ending May 31), the company had 2,944 EVs in service, which included delivery trucks, forklifts and airport ground service equipment. Also as part of FedEx’s 2040 plan, the company will continue its Fuel Sense initiatives which are designed to reduce fuel consumption in its aircraft. According to FedEx, since 2012, the FedEx Fuel Sense and Aircraft Modernization programs have saved a combined 1.43 billion gallons of jet fuel and avoided over 13.5 million tonnes of carbon dioxide (CO2) emissions. Meanwhile, UPS invested in EV maker Arrival and will buy 10,000 of its EVs to add to the UPS fleet in North America and Europe, with vehicle delivery from 2020 to 2024. UPS has also been working with Workhorse to develop an electric transport vehicle. In 2018, UPS had 1,000 electric vehicles in its fleet of 112,000 vehicles. The cost of the new vehicle was found to be no more than regular diesel vehicles, because the cost of electric batteries have declined 80%, according to UPS. UPS, however, has made significant investments in its recently formed subsidiary, UPS Flight Forward which is focused on drone delivery. This week, the UPS subsidiary announced that it would purchase ten Alia-250c electric vertical takeoff and landing (eVTOL) aircraft made by Beta Technologies. UPS Chief Information and Engineering Officer Juan Perez noted in the company’s press release that the new aircraft will “create operational efficiencies in our business, open possibilities for new services, and serve as a foundation for future solutions to reduce the emissions profile of our air and ground operation.” There are a growing number of electric airplanes and drone companies that are looking to not only disrupt the air cargo space but to also provide a cleaner solution. Airflow.aero, for example, is looking to provide electric cargo airplanes to move goods in payloads of up to 500 pounds into cities from regional distribution centers. Among the benefits of this model is to save 632,000 pounds of CO2 per aircraft according to its website. Associations such as the Sustainable Air Freight Alliance (SAFA), a buyer-supplier collaboration between shippers, freight forwarders and airlines, have formed to track and reduce carbon dioxide emissions from airfreight and promote responsible freight transport. Airline members are AirBridgeCargo Airlines, American Airlines, Cargolux, Cathay Pacific, Delta Air Lines, LOT Polish Airlines, Lufthansa Cargo, Polar Air Cargo, SAS and United Airlines. Shipper members include H & M Hennes & Mauritz AB, Hewlett Packard Enterprises, Louis Vuitton, LVMH Moët Hennessy, Mowi ASA, NIKE Inc. and PUMA SE. A study from Coyote Logistics found that 81% of shippers surveyed are more focused on sustainability today than they were three years ago, driving measurable gains for these companies. In addition, 84% of survey respondents were more likely to base a purchase decision on a company’s sustainability practices.

Consultant Insight: FedEx and UPS emphasize the importance of sustainability

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