UPS reserves largest order yet of Tesla's all-electric Semi

UPS said it will be among the first to have the Tesla Semi on the road after production begins in 2019.

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(Image: Tesla)

UPS said Tuesday it has pre-ordered 125 of Tesla's upcoming all-electric Semi, to join its alternative fuel and advanced technology vehicle fleet. Past a reduced cost of ownership and eco promises, UPS believes Tesla's Semi could reduce crashes, thanks to its automatic braking, adaptive cruise control, and other safety features.

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Announced in November, Tesla said its Semi will have a 300-mile range for a base price of $150,000, and a 500-mile model will be available for $180,000. Production is expected to begin in 2019, and UPS said it will be among the first companies to put the vehicle in use. It's not clear what mix of vehicles UPS reserved from Tesla.

"For more than a century, UPS has led the industry in testing and implementing new technologies for more efficient fleet operations. We look forward to expanding further our commitment to fleet excellence with Tesla," said Juan Perez, chief information and engineering officer at UPS. "These groundbreaking electric tractors are poised to usher in a new era in improved safety, reduced environmental impact, and reduced cost of ownership."

Past being eco friendly, Tesla believes its Semi will be cheaper than diesel alternatives in the long run. Tesla claims its Semi has a total cost per mile of $1.26 compared with a diesel truck's $1.51. The 300-mile Semi would be about $30,000 more than the upfront cost of a diesel semi, but Tesla argues it can offer substantial savings on operating costs such as maintenance and fuel. It says owners will get a two-year payback and "$200,000+ in fuel savings".

UPS said it provided Tesla with real-world UPS trucking lane information to evaluate the vehicle's performance while performing UPS duties.

UPS operates one of the largest commercial vehicle fleets in the world.

Tesla told Reuters that UPS' reservation of the Semi is its biggest yet. Other companies to place orders includes Pepsi and Walmart, and we're sure to see more disclose orders over the next year. Tesla hasn't promised a ship date for the Semi.

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