Amazon is working ‘closely’ with UAE authorities to deploy electric vehicle delivery fleet

Amazon is working “closely” with authorities in the United Arab Emirates to accelerate plans to deploy a fleet of electric vehicles for deliveries, a senior regional executive said.

The world’s largest online marketplace, which in 2022 pledged to deploy 100,000 electric vehicles for last-mile deliveries globally by 2030, is also in touch with other partners to overcome challenges that may hinder the use of these eco-friendly vehicles, said Prashant Saran, chief operating officer at Amazon Turkey, Middle East and Africa. National in the interview.

“In this region, because of the extreme heat, there is no scalable, fully proven commercial electric vehicle model yet. Right now, it is a challenge because of the temperature and the batteries,” he said in Dubai on Wednesday, ahead of the fifth Amazon Prime Day in the UAE on July 16.

“But we see this as an opportunity. That’s why we’re working closely with the government, small and medium-sized enterprises and original equipment manufacturers, as well as our supply partners.

Late last year, Amazon convened a workshop to look at “some of the challenges in this space and what can be done from a technology and policy perspective to scale up these efforts,” he said.

A timeline for the launch of the electric vehicle delivery fleet has not yet been set, but the initiative is a “work in progress” that Amazon is “continuously piloting and testing,” Mr. Saran said.

“We already have delivery partners who are using e-scooters to deliver to densely populated areas… we are very committed to that and the share of electric vehicles in our traffic will continue to increase over time,” he said.

The all-electric fleet will help Amazon achieve its plans to achieve net zero emissions by 2040 as the world transitions to more sustainable forms of transportation.

The Seattle-based company also co-founded The Climate Pledge in 2019, which commits organizations to achieving net-zero carbon emissions by 2040—a decade ahead of the 2050 Paris Agreement goal.

Amazon began using electric delivery vehicles from another American company, Rivian, in 2022. There are currently about 13,500 electric vehicles on U.S. roads and more than 1,300 in Europe.

In addition to the 100,000 Rivian vans the company has promised, Amazon has put more than 15 EV models on the road, including delivery vans, e-bikes and e-rickshaws, to “test and learn” in the U.S., EU and India.

An electric fleet would boost operational efficiency in the United Arab Emirates — which has stepped up efforts to promote and put more electric vehicles on its roads — and the Middle East, where Amazon has made significant investments: it has two major fulfillment centers in Abu Dhabi and Dubai, and has increased its processing capacity in the UAE and Saudi Arabia by 70% and 100%, respectively.

“We are here for the long haul and we intend to raise the bar… in terms of infrastructure investment,” Mr. Saran said.

Meanwhile, Amazon’s fifth Prime Day in the UAE is expected to be a continuation of last year’s as more consumers gravitate towards more budget-friendly deals that influence their purchasing decisions, said Stefano Martinelli, vice president of Amazon in the UAE and Saudi Arabia.

He added that the 2023 edition of Amazon’s biggest shopping event was the largest in the company’s history, with 375 million products sold and Prime customers saving $2.5 billion.

Amazon data shows the number of UAE consumers shopping online each week has doubled, “which gives us confidence that e-commerce is growing healthily,” Mr Martinelli said National.

“Choice, price and convenience are still the three pillars that every customer wants.”

The e-commerce market in the UAE is expected to reach $9.2 billion in 2026, up almost 92% from 2021, according to the Dubai Chamber of Commerce in 2022.

The study, based on Euromonitor data, also forecasts that e-commerce’s share of total retail sales will reach 12.6 percent by 2026.

The growth dynamics of the e-commerce sector in the UAE is supported by increasing demand for online shopping and a steady influx of investments in the sector’s infrastructure, the study found.

Updated: July 3, 2024, 16:00