Online shopping’s resident goliath is investing in cleaner ways to power its transportation network.
Amazon (NASDAQ: AMZN) on Sunday announced plans to spend 1 billion euros (about $970 million) to electrify and decarbonize its European fleet over the next five years. The e-commerce giant will invest in electric vans, small delivery hubs and charging stations.
By 2025, the company expects to grow its fleet of 3,000 electric vans across Europe to more than 10,000. It also aims to purchase and roll out over 1,500 electric heavy goods vehicles (eHGVs) designed for long-haul transportation in the coming years.
The investment is part of Amazon’s goal of reaching net-zero carbon emissions by 2040, along with forays into other technologies like e-bikes and drone and robot delivery.
“Deploying thousands of electric vans, long-haul trucks, and bikes will help us shift further away from traditional fossil fuels — and hopefully, further encourage transportation and automotive industries in Europe and around the world to continue scaling and innovating, as we will have to work together to reach our climate goals,” said CEO Andy Jassy.
Amazon’s plan allocates just over one-third of the money (about $331 million) to its U.K. network. There, it will roll out around 700 of its 1,500 planned eHGVs.
“We are committed to creating cleaner transport as we work to tackle the global challenge that is climate change,” said U.K. Transport Secretary Anne-Marie Trevelyan in a statement posted to Amazon’s U.K. blog. “Significant investments like Amazon’s today will be vital to reducing emissions and meeting our Net Zero goals, while supporting growth at the same time.”
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In addition to expanding its fleets of electric vans and eHGVs across Europe, Amazon plans to double the number of “micro-mobility hubs” it operates on the continent. These are small, centrally located delivery stations in cities like London, Munich and Paris that allow the company to deliver on foot or via e-bike. Currently, the hubs are in more than 20 cities.
To power its electric vehicle network, Amazon will invest in thousands of chargers across Europe, including hundreds that are specialized to charge the weightier eHGVs.
Amazon doesn’t make its own electric vehicles — rather, it sources them from a who’s who of automakers. They include Mercedes-Benz, Canada’s Lion Electric and Volvo, from which it ordered 20 electric trucks just last week.
But the company’s biggest supplier by far is California-based Rivian (NASDAQ: RIVN). Amazon invested $700 million in the EV maker in 2019, and shortly after, it announced it had placed an order for 100,000 Rivian Electric Delivery Vans — the largest EV order in history.
However, Rivian this weekend revealed that it had recalled nearly all of its vehicles after discovering a defect with a fastener that could come loose in rare cases. The issue was only discovered in seven vehicles. But the mass recall has investors concerned that the company may fall short of its goal to produce 25,000 vehicles by year’s end.
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It’s unclear where Amazon plans to source the vehicles for its European fleet, but the e-commerce giant has already rolled out Rivian EVs in over a dozen U.S. cities. By the end of the year, it aims to have several thousand vehicles on the road in over 100 cities.
It also noted that it hopes to have 100,000 vehicles — the same number it purchased from Rivian in its initial order — on U.S. roads by 2030. The implication is that Amazon plans to deploy all of those vehicles in the U.S., meaning it may not be relying on that order to build out its European fleet.
EVs are only one piece of Amazon’s global sustainability investments. In the U.S., it recently launched drone delivery in California and Texas, with plans to expand the service to other states and cities in the coming years.
And in the U.K., the company earlier this year launched a fleet of e-cargo bikes and a team of on-foot delivery staff in London, the site of its first “micro-mobility hub.” The service was designed to replace thousands of deliveries via van.
Until recently, Amazon was making steady progress on robot delivery. But it suffered a setback last week when it halted testing of its Scout home delivery robot, a cooler-sized autonomous vehicle introduced in 2019.
The company’s investments in sustainable transportation come as it struggles to shrink its carbon footprint. According to its latest sustainability report, the firm’s carbon dioxide emissions grew 18% in 2021 compared to 2020.
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