Electric Tuk Tuks in Australia: Ikea and logistics giant ANC get serious about last mile delivery

Electric Tuk Tuks are to make their debut in Australia as part of a new initiative by logistics giant ANC and retailing monolith Ikea get serious about the cleaning up of “last mile” delivery transport in Australia.

“Last mile” refers to the final journey of cargo and parcels from distribution centre to the customer, and it is seen – because of the short distances and its operation in built up areas – as an obvious sector to target as the transport world dumps polluting fossil fuels for electric drive trains.

In Europe, electric vans are being rolled out at pace – largely because residents and city and national governments are sick and tired of polluting trucks in their local area. Delivery times are tightly controlled, and within years it is expected that diesel and petrol vans will be banned from built up areas. They already are in some locatios.

Australia, as with most things EV, is dragging the chain. But on Thursday, last-mile delivery specialist ANC and leasing specialist  Orix announced a strategic partnership to show how fleet electrification can be achieved.

ANC currently has 10 electric vans – out of a total fleet of more than 1,100 vehicles – but wants to ramp this up rapidly, at least doubling the numbers in the next year and then again the next.

On Thursday it unveiled an Australian first: a specially-designed electric TukTuk manufactured by Biliti Electric in India and and imported exclusively by Brisbane-based company EMoS.

The electric three-wheelers will be used by Ikea’s Tempe store in Sydney, and will feature swappable 9kWh batteries, although they will be limited to speeds of 50km/h  due to Australian homologation rules.

One Tuk Tuk was on display after being flown in from India, but without its battery which has to be shipped. Their drivers will need to wear helmets.

“We’re very excited to be pioneering these new 3-wheel EVs in Australia,” says ANC CEO Joe Sofra.

“They’re being used globally – including by IKEA – and will be launched into the US market in coming months. Initially our two e-TukTuks – which we’ve nicknamed BUDDe – will be deployed to carry out deliveries for IKEA Australia’s Tempe store for a 3-month trial to prove concept.”

Sofra says there is a global revolution underway as the last-mile delivery sector accelerates fleet electrification and EVs are a perfect match for the sector.

“We didn’t want to sit idly by and wait for the perfect economic environment to accelerate our EV goals. We could miss the boast, or in this case truck, van or Tuk Tuk. We now urge other last-mile delivery providers to take up the challenge.

“It’s just a question of how hard and fast we can go.”

Sofra is hopeful that the deal with Ikea can trigger other big retailers and suppliers to follow suit, and is hopeful also for government to also lend its support to ease the cost of the transition. Electric trucks remain expensive, and although there is an expected “after-market” in used batteries – for homes and the grid – the monetary benefits of that remain ill defined.

The partnership with Orix will help create a “capital light” expansion into EVs, and demonstrate that the running costs are favourable, and better than renting.

“It’s still early days for EVs as fleet vehicles and there are still many challenges, however, partnering with like-minded organisations helps overcome barriers and creates greener, more sustainable outcomes,” says Reggie Cabal, the CEO of Orix.

He says many companies are in a “holding pattern” as they seek to undertand the market and the technology.

“We are helping remove the complexity for delivery professionals to adopt EVs by aligning vehicles, infrastructure, energy and optimisation into a single, practical plan for a decarbonised fleet future,” he said. “It’s important we act now.”

Ikea is aiming for 100 per cent zero emissions delivery by 2025, and is also calling on government to provide incentives and to help with charging infrastructure.

“We are committed to this goal and want to bring the retail sector on the journey with us,” said Mirja Viinanen, the CEO of Ikea and its chief sustainability officer.

“So we are calling on the government to help us get there by introducing targeted incentives and charging infrastructure for last-mile delivery and logistics to boost the uptake of EVs.”