PepsiCo will start deploying Tesla Semis in 2023   

PepsiCo aims to deploy 100 heavy-duty Tesla Semis in 2023, when it will begin utilizing the electric trucks to distribute to customers such as Walmart and Kroger, according to the beverage maker’s top fleet official, who spoke to Reuters on Friday.

PepsiCo Inc, which purchased the large trucks in 2017, is purchasing them “outright” and modernizing its operations, including constructing four 750-kilowatt Tesla Inc charging stalls at both its Modesto and Sacramento locations in California, according to PepsiCo Vice President Mike O’Connell. Part of the expenditures is covered by a $15.4 million state grant and a $40,000 federal subsidy per vehicle.

“It’s a great starting point to electrify,” said O’Connell, who oversees the company’s fleet of vehicles. “Like any early technology, the incentives help us build out the program,” he said, adding that there were “lots” of development and infrastructure costs.

PepsiCo is the first corporation to test battery-powered Tesla Semis to reduce its environmental impact.

The trucks have also been reserved by United Parcel Service Inc and food delivery provider Sysco Corp, while retailer Walmart Inc is testing alternatives. PepsiCo’s plans to employ the Semis have been published, but O’Connell revealed additional specifics on how the business intends to use them and when they will be deployed. Tesla CEO Elon Musk initially stated that the trucks will be available in 2019, however, this was postponed owing to battery restrictions.

PepsiCo planned to send 15 trucks from Modesto and 21 trucks from Sacramento. It is uncertain where the others would be based, but O’Connell stated that the Semis will first be introduced in the center United States, followed by the East Coast.

The Frito-Lay segment of the corporation sells lightweight food products, making it an ideal option for electric vehicles, which have large batteries that may limit cargo capacity.

The Semis will transport Frito-Lay food products for approximately 425 miles (684 km), although for heavy loads of soda, the trucks will first make shorter journeys of approximately 100 miles (160 km), according to O’Connell. PepsiCo will next use the Semis to transport beverages in the “400 to 500-mile area,” according to O’Connell.

“Dragging a trailer full of chips around is not the most intense, tough ask,” said Oliver Dixon, senior analyst at consultancy Guidehouse.

“I still believe that Tesla has an awful lot to prove to the broader commercial vehicle marketplace,” Dixon said, citing Tesla’s unwillingness to offer information on payload and pricing.

Some of the vehicles planned for the Sacramento facility have been designated for delivery to Walmart and retailers such as Kroger Co and Albertsons Cos Inc. Trucks from the Frito-Lay plant in Modesto have just arrived at PepsiCo distribution hubs, according to O’Connell.

All of the Semis traveling to PepsiCo will have a range of 500 miles (805 kilometers). O’Connell also stated that he does not know when Tesla will begin deploying 300-mile (480-km) trucks. When Tesla begins production, PepsiCo will “will rotate those up” into its fleet, he said.

PepsiCo declined to provide pricing information for the trucks, which Tesla has kept private. According to Mark Barrott of consulting firm Plante Moran, comparable vehicles sell for $230,000 to $240,000. He stated that the Tesla Semi’s 500-mile range could be more expensive because its 1,000-kilowatt-hour (kWh) battery pack is almost twice the capacity of many of its competitors.

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