Everything You Need to Know About Electrifying the Last Mile

The last-mile delivery sector is rapidly evolving, driven by surging e-commerce demands and sustainability pressures. With North America poised for 7.2% market growth through 2030, companies must optimize deliveries while helping to minimize environmental impact.

Purpose-built electric delivery vehicles are emerging as a solution that combines operational efficiency with environmental responsibility, helping businesses scale while meeting stricter emissions regulations. A shift is already being seen, with major logistics companies making ambitious commitments to transition their fleets:

• FedEx: Committed to converting entire parcel pickup and delivery (PUD) fleet to zero-emission electric vehicles by 2040
• UPS: Ordered thousands of electric delivery vehicles as part of their sustainable logistics strategy 
• Amazon: Investing heavily in electric delivery vans, with plans to deploy 100,000 electric vehicles 
• Walmart: Recently announced deployment of BrightDrop 400 vans to support their InHome delivery service
• DHL: Targeting 60% electric vehicles in their fleet by 2030 as part of their zero-emissions goal.

In this article, we’ll consider the key challenges for EV adoption, their suitability for last-mile delivery operations, and incentives that are available to soften upfront costs.

While range anxiety remains a common concern, modern electric delivery vehicles have largely addressed this issue. With a range of GM estimated 272 miles,* the 2025 Chevrolet BrightDrop can handle typical daily routes with plenty of capacity to spare. Additionally:

• Fast-charging capabilities provide up to 180 miles of range in about an hour of charging*
• Smart routing systems can integrate charging stops during natural break times
• Most last-mile delivery routes fall well within daily range capabilities
• Advanced telematics provide real-time range monitoring and optimization

While electric vehicles (EVs) typically have higher upfront costs compared to traditional ICE (internal combustion engine) vehicles, a 2023 report from the Office of the Under Secretary of Defense for Acquisition and Sustainment found that EVs consistently demonstrate a lower Total Cost of Ownership (TCO). EVs cut operating costs through 50% lower fuel expenses and 40% reduced maintenance ($0.061/mile vs $0.101 for ICEs), thanks to simpler mechanics eliminating traditional components like spark plugs and timing belts. GM estimates that annual savings could add up to $10,000 compared to diesel alternatives.* State incentives can also reduce costs by up to 32%.

Electric delivery vehicles serve as visible symbols of environmental commitment, turning every delivery into a rolling advertisement of company values.

This translates directly to customer loyalty, with brands embracing sustainability initiatives seeing repeat purchase rates increase by up to 34%. As consumer awareness of sustainability grows, electric delivery fleets increasingly influence purchasing decisions and brand perception, providing a competitive advantage in an environmentally conscious market.

Electric vehicles offer unique benefits for increasingly regulated city operations:

• Silent operation enabling extended delivery hours in noise-sensitive areas
• Near instant torque for efficient stop-and-go driving
• Purpose-built design maximizing cargo space compared to converted ICE vehicles (Chevrolet BrightDrop 600: 614.7 cubic feet* vs Ford Transit: 445 cubic feet)
• Priority access to urban areas through emerging Low Emission Zones

While the United States is in early stages of implementing Low Emission Zones, forward-thinking cities like Santa Monica have already trialed priority curb access to electric delivery vehicles, with Los Angeles and New York City exploring similar initiatives. The success of established programs, such as London's Ultra Low-Emission Zone which has reduced NO2 levels by 53% in central areas, demonstrates the growing importance of zero tailpipe emission capabilities.

By proactively adopting electric vans now, fleet operators avoid rushed transitions while securing both current incentives and preferential urban access, establishing significant competitive advantages as more cities restrict conventional vehicles.

The transition to electric delivery vehicles is supported by numerous state and local incentives aimed at reducing tailpipe emissions. Commercial fleet operators can benefit from significant tax credits and incentives to offset initial purchase costs.

State-level incentives for electric fleet vehicles vary significantly across the country. Colorado offers up to $12,000 tax credit through the Innovative Truck Credit and grants up to $250,000 to purchase and install charging infrastructure through the Charge Ahead program. Massachusetts provides up to $15,000 rebate through MOR-EV Trucks and up to $50,000 grant to purchase and install charging infrastructure through MassEVIP. California will soon offer up to $40,000 through the HVIP program. New York supports fleet electrification with New York Truck Voucher Incentive Program vouchers up to $85,000 and additional utility provider incentives from companies like Con Edison which can cover up to 50% of customer-side make-ready costs or PSEG Long Island which provides up to $70,000 to offset electric infrastructure costs.

While EVs offer sufficient range for most routes, smart optimization helps maximize efficiency and helps reduce range anxiety.

• Integrate charging locations into existing routes
• Utilize regenerative braking in stop-and-go areas
• Account for seasonal range variations
• Use telematics for real-time route adjustments
• Monitor and optimize based on actual performance data

Electric fleets require specialized insurance considerations to properly protect both vehicles and infrastructure.

• Assess coverage for EV-specific risks
• Include charging infrastructure in policies
• Work with EV-knowledgeable insurers
• Review coverage as fleet transitions
• Monitor risk profile changes