ZET SCALE orders 2,500 Class 8 battery electric trucks, most of them from Tesla

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According to the International Council on Clean Transportation, prices for electric trucks in Europe have decreased by 27 percent in recent years, while prices in the United States have increased by 32 percent. American truck manufacturers and the transportation industry have used every weapon at their disposal to curb the sale of electric trucks so they can produce more, more profitable Class 8 diesel trucks.

To offset some of that industry pressure, the Leading Zero Emission Truck Carrier and Carrier Electrification Alliance, also known as ZET SCALE, is looking to accelerate the deployment of heavy-duty electric trucks across North America, with the goal of adding 10,000 of them to the country’s roads as soon as possible.

The effort brings together shippers, shippers, truck manufacturers, freight and financing providers in a joint purchase, which can turn a costly and daunting transition into a clear, affordable and lower-risk experience. Interested parties no longer need to navigate the ins and outs of purchasing heavy-duty electric trucks alone. ZET SCALE aligns the entire value chain, enabling better vehicle pricing, innovative financing, coordinated charging infrastructure and transport demand, all of which helps make zero-emission road transport commercially viable.

Commitment for 2,500 electric trucks

ZET SCALE is a branch of Catalyst Mobility, which used to be known as CALSTART. The Smart Freight Center is a partner of the new organization, as are Microsoft and PepsiCo. Their goal is to obtain lower prices from manufacturers by offering them wholesale purchases.

This week, it announced it had secured commitments from its members to purchase 2,500 battery-electric Class 8 trucks, equal to the total number of them in the U.S. today. Of those 2,500 trucks, the majority will come from Tesla, and the rest will be supplied by Kenworth, Volvo and RIDE. “After evaluating price, range, load capacity and production capacity, the Alliance selected Tesla as its main OEM for the initial 2,500 trucks,” ZET SCALE said.

All North American Class 8 truck manufacturers were invited to participate in the bidding. The 2,500 Class 8 electric trucks will be distributed across ten charging centers over the next few years: Los Angeles, Stockton, Bakersfield, Seattle/Tacoma, Houston, Dallas, San Antonio, Chicago, Atlanta and the Newark/New York area. The delivery schedule is not yet known.

The ZET SCALE initiative is supported by a financial company called ZET Financial, which places orders and operates the ZET Lease program that is designed to remove residual value risk from fleet balance sheets. According to Michael Berube, CEO of Catalyst Mobility, that risk has been a major barrier in the market. “You can have good technology and still not have a market,” explains Berube. “What’s different about ZET SCALE is that demand was organized so manufacturers could set prices at scale. That’s how costs move and that’s how clean trucks come out of the pilot phase.”

Christoph Wolff, CEO of the Smart Freight Center, agrees. “Every part of the freight industry wants cleaner trucks, but until now each company faced that transition (and its risks) alone. ZET SCALE aligns shippers, transporters, manufacturers and financiers around a single real demand signal. When risk is shared along the entire chain instead of depending on a single player, the industry can finally move at scale,” he says.

California SB 1213 enacted

ZET SCALE’s announcement came the same week that the state of California passed new legislation designed to bring greater pricing transparency and accountability to California’s zero-emission medium and heavy-duty truck market. According to State Senator Eloise Gómez Reyes, sponsor of the new legislation, SB 1213 will provide the state with better information on vehicle prices to help ensure that those public investments effectively reduce costs and support the deployment of zero-emission trucks.

“California is making significant investments in our clean transportation future, and taxpayers and fleet operators deserve to know that those investments are generating real value,” Reyes said. “SB 1213 brings greater transparency and accountability to the clean truck market so we can better understand what these vehicles really cost and help reduce those costs over time. For communities like the Inland Empire, where families have endured the health impacts of moving goods for generations, making cleaner trucks more affordable means cleaner air and healthier neighborhoods.”

To ensure long-term market stability, SB 1213 directs the state to explore alternative financing models, including low-cost loans and residual value guarantees. Those tools are specifically designed to scale the market more quickly, encourage new entrants into manufacturing, and give fleets financial confidence to invest in a zero-emissions future.

This bill also provides a model for other states to ensure that their truck incentive programs actually make affordable trucks available to fleet operators. Seven states, including California, have published guidelines for reporting electric truck price data to improve the effectiveness of state incentive programs.

Dan Priestley, who leads the Tesla Semi program, said in a statement: “ZET SCALE’s goals are exciting because they take the operating cost advantage and predictability that electricity provides and amplify it at scale. We are proud to have been the top selection in this RFP and look forward to providing shippers and carriers with a new competitive advantage.”

There is no information available on whether ZET SCALE was able to reduce the purchase price of the Tesla Semjs it will purchase.

Tesla recently received an order for 500 semi-trailers from Einride and an additional order for 50 trucks from IMC Logisitics. Einride’s order includes standard-range semi-trailers for transportation from ports, as well as long-range semi-trailers for routes between Southern California and inland warehouses. It also had a significant presence at this year’s IAA Transportation show in Hannover, Germany, where electric trucks of all sizes and descriptions were on display.

Fear of competition

If prices are dropping a bit in Europe, it may be partly due to the presence of electric models from Chinese manufacturers like Sany, which are typically less expensive than trucks made in the country. BYD had a big presence in Hannover last week and already makes electric buses in California. It would be interesting to compare the prices of the Class 8 electric trucks with those of Tesla.

Of course, there are no Chinese electric trucks in the United States, because the country is terrified of competition. Imagine that! A nation that for the past 70 years has prided itself on manufacturing the best products the world has ever known and exporting them to every corner of the globe trembles at the thought of having to compete with other countries. Political initiatives are welcome, but a healthy dose of competition would do wonders for the transition to electric trucks in the United States.

The total cost of ownership equation favors electric trucks today due to the high cost of diesel fuel, but fleet operators think in terms of years, not weeks. If they believe the diesel crisis will resolve itself fairly quickly, they have less incentive to move away from diesel trucks, which cost less than half as much to purchase as new electric trucks: $180,000 versus $400,000, according to Google.

One bright spot on the horizon is that electric truck sales in China have soared in the past year to the point of dominating new truck sales. That’s what ZET SCALE would like to see happen in the United States.