Logistics companies in Canada have been experiencing an unusually busy holiday season this year. Soaring online purchases and a Canada Post strike sent orders for door-to-door deliveries flooding in to Purolator and UPS, which had to temporarily pause shipments to clear the backlog.
However, one courier service that has managed to keep pace is nrbi, which deploys a fleet of electric cargo bikes in Toronto and Vancouver. Zipping through clogged city streets, delivering the same number of packages per day as a conventional fleet, nrbi offers a window into the benefits of nimble, electric-powered service. Not to mention the environmental benefits in a world that increasingly relies on home drop-offs for everyday purchases.
“Our bikes don’t have to deal with traffic congestion, especially the end-of-the-day rush hour. We don’t experience the slowdowns that a van does,” co-founder Ivan Waissbluth says. “A van can deliver up to 125 to 200 packages a day,” he adds. “So can a cargo bike. But when we tell a customer what time we’ll drop off the package, that’s what time we’ll be there.”
The big players in the logistics industry have also been leaning into electric bikes for last-mile deliveries, which is the last leg in the journey of a package from the fulfillment centre to the customer’s home. Purolator launched an e-cargo bike service in Montreal in 2019 and has continued to expand its fleets and the locations where they operate.
Purolator found that, on average, the stopping frequency of an electric cargo bike was 37 stops per day, compared to a delivery truck’s 24. Moreover, the parking duration of cargo e-bikes was about 65% shorter than that of a delivery vehicle.
FedEx Express began with three e-cargo bikes offering doorstep deliveries throughout Toronto’s downtown core in 2020. The company’s fleet has since grown to 47 e-bikes cycling through Canada’s largest urban centres, including Ottawa, Calgary and Vancouver. To date, FedEx Express fleets have covered more than 120,000 kilometres and delivered more than 400,000 packages.
At nrbi, Waissbluth says that the bikes “are moving from 8 a.m. to 9 p.m. and appear to be equally productive regardless of the time of day.”
E-commerce takes off
The logistics business is booming thanks to online shopping. E-commerce came into our lives in the mid-1990s when Amazon and eBay launched. Still, the shift from in-person retail therapy to online impulse buy was incremental. Fifteen years after the introduction of digital shopping platforms that offered secure transactions, online purchases made up just over 6% of U.S. sales. As of 2021, e-commerce transactions pole-vaulted to 19.1% of total U.S. sales. In Canada, 11.9% of retail sales are e-commerce.
Since the onset of the global pandemic, Purolator has seen residential deliveries grow by approximately 50%, boosting demand for transportation and courier services.
At the same time, according to a FedEx white paper on e-commerce insights and trends, consumer demand is strong for faster delivery times, with 55% of consumers willing to pay for same-day delivery and 45% willing to pay for next-day delivery.
This year has been especially frantic because of the postal strike. “Usually, volume peaks last five to six days after Black Friday,” Waissbluth says. “This year, it’s lasted 10 to 12 days. I’d say volume is up 20% to 25%.” In response, nrbi has hired more cyclists and doubled the number of shifts they work.
The co-benefits of e-cargo bikes
Needless to say, growth in e-commerce has had a profound impact on city streets, with delivery trucks taking up significant space on already congested roadways. Spurred by the pandemic, home deliveries increased, arguably worsening city-centre gridlock.
Driver frustration is one of many adverse outcomes from chronic traffic snarls. Tailpipe emissions are the primary source of air pollution in urban areas, and the health implications are stark: fine particulate pollution generated by the burning of fossil fuels has been estimated to cause one in five premature deaths globally.
Joe Vipond, an emergency care physician based in Calgary and past president of the Canadian Association of Physicians for the Environment, says that the pollutants generated by trucks powered by diesel fuel contribute to increases in heart attacks, heart failure and stroke. “Bad air is implicated in cancer prevalence and children’s lung development,” Vipond says. “But it’s not just lung-related ailments. Cardiovascular health is also at risk.”
Greenhouse gas emissions also fall when fossil fuel vehicles are switched out for e-cargo bikes. FedEx Express reports that, thanks to its Canadian fleet, 14 tonnes of carbon emissions have been averted since its e-bike launch. Purolator found that replacing one delivery van with one cargo e-bike serving a “delivery area” neighbourhood can eliminate as much as 5.5 tonnes of greenhouse gas emissions.
Legacy providers have also discovered significant cost savings. Earlier this year, InnoEnergy in the United Kingdom released a study showing the impact on the bottom line when a logistics company integrates electric bikes with its fossil fuel vehicles. Using UPS as the test case (the carrier delivers 5.2 billion domestic packages per year), and depending on the bike-to-van ratio and city layout, InnoEnergy concluded that UPS could save as much as US$445 million per year by ditching fossil-fuelled vehicles for cargo bikes strictly for last-mile services in downtown areas.
Fast forward?
While uncertainties always cloud forecasts, this may be a pivotal time for the role of e-cargo bikes in delivering last-mile drop-offs. Improving cycling infrastructure will be key to future success, and Canadian cities are not especially bike-friendly compared to other large urban centres in Europe, such as Copenhagen or Amsterdam. “I would not describe Toronto as having an abundance of dedicated bike lanes,” says Waissbluth, who would like to see additional bike lanes in the city and to ensure that cyclists are safe.
Waissbluth also notes that some of the cyclists who work for nrbi take public transit to work and will likely be affected by the recent Toronto Transit Commission decision to ban e-bikes from TTC vehicles and stations.
Weather, however, is rarely a problem. Purolator says its e-bikes have capacity for approximately 60 pieces per trip and are winterized for year-round operations. FedEx Express points to Calgary as one of the first Canadian cities to embrace the presence of e-cargo bikes and says that Alberta’s frigid winters have not been a deterrent.
The biggest barrier preventing e-cargo bikes from being thoroughly integrated into the urban logistics system, says Waissbluth, is the cost of running an urban depot. “For this system to work, light industrial space has to be affordable. It’s the only way we can truly compete against the van.”
