Electric truck to debut this year amid boom in EV investments

Key Points
  • Chanje is making an all-electric truck to compete against medium duty, short-haul commercial vehicles.
  • Deliveries are expected this year. The vehicle is expected to get the equivalent of 50 miles per gallon when fully charged.
  • Chanje is the latest Chinese-backed start-up to be based in the U.S.
  • It says the initial Chanje electric vehicle will be built in China, but assembly will transition to the U.S.
Chanje electric vehicle truck.
Source: Chanj

It may look like any other delivery van on the streets of San Francisco but look and listen for a few extra seconds and you'll notice the difference.

The all-electric truck by Chanje (as in "change") is out to shake up the medium duty, short-haul commercial truck market.

"We really see this potential in the middle ground where everything you move in the city can be cleaner and quieter, and we think Chanje has offered that solution," CEO Bryan Hansel said.

While the price of the all-electric commercial van has not yet been announced, Hansel is targeting first deliveries for this year. He expects customers will lease the vehicle with the expectation it will get the equivalent of 50 miles per gallon when fully charged.

"We see the opportunity to fundamentally disrupt it (the commercial truck market)," said Hansel, whose start-up is backed by Chinese investors.

The promise of being the next big thing in electric vehicles has fueled a wave of investments by venture capital firms, automakers, suppliers and tech companies. All are trying to profit on the expectation the world will eventually move from gas- and diesel-powered vehicles into electric models.

This year, it's estimated a record $2.7 billion will be invested in EV tech companies, according to CB Insights, a data intelligence platform that tracks electric vehicle investments.

"The landscape is definitely starting to shift," said Kerry Wu, senior mobility analyst with CB Insights.

The money is pouring into companies that build electric vehicles, like Chanje, and those that supply the infrastructure, like ChargePoint, which is building electric vehicle charging stations.

CB Insights expects the industry will see more than 60 funding deals this year, almost double the number of EV-related funding deals four years ago. In 2013, investors pumped a relatively modest $156 million into EV-related companies.

What's changed over the last four years?

Interior of a Chanje electric truck vehicle.
Source: Chanj

For starters, the cost of an electric vehicle battery pack has plunged from an average of $615 per kilowatt hour in 2013 to about $200 per kWh in 2016, according the consulting firm AlixPartners. That drop means EVs are more cost effective and more attractive to potential buyers.

In addition, governments around the world have become more committed to developing demand for electric vehicles. China is the biggest influence. It has passed the U.S. to become the world's largest electric vehicle market, with sales expected to hit almost 500,000 EVs this year.

"The economics of electric vehicles are becoming more attractive," said Wu.

Chanje is the latest U.S.-based start-up to be backed by Chinese investors. Hong Kong-based FDG Electric Vehicles and partners have invested $1 billion in developing and bringing the Chanje truck to market.

Hansel said the initial Chanje electric vehicle will be built in China but assembly will transition to the U.S. It's another example of the tighter bond being formed between China and Silicon Valley when it comes to electric vehicles.

"You need the technology and the innovation and the vision that comes out of Silicon Valley," said Hansel. "But at the same time, you need scale and the commitment that China has made to the capital."