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UPS orders 10,000 vans from Arrival

The UK-based electric van manufacturer Arrival has received an order for 10,000 vans from US delivery company United Parcel Services (UPS). The £339m order comes just a week after the announcement that Hyundai-Kia had invested £85m in the firm.

Investment in the UK’s automotive industry has taken a hit due to Brexit but one company is standing out as beacon of hope. Founded by Russian billionaire Denis Sverdlov in 2015, the London-based company – with its main manufacturing facility in Oxfordshire – is securing investment and orders from blue chips around the world.

The first UPS vans have already been produced and the first deliveries are expected to take place in the next couple of months and continue until 2024. Arrival has already purchased properties in New York and California which will be turned into new ‘microfactories’.

Unlike the conventional rolling production line that most manufacturers employ, Arrival has opted for a highly-robotised modular production process, which means that vehicles can be more easily tailored to customers’ specifications and reduces labour costs.

Inside sources at Arrival say the order could increase to up to £510m and 15,000 vans over the next couple of years. UPS will also secure an unknown stake in Arrival.

The order implies UPS are paying £34,000 for each van although smaller fleets without the economies of scale will likely pay nearer to £40,000. However, this is still slightly less than electric versions of the similarly-sized Mercedes-Benz eSprinter and VW eCrafter – which we expect to be priced at around £50,000 and £60,000 respectively.