Imagine you manage a fleet of delivery vehicles. One of your biggest expenses is fuel, and you’d love to switch to hybrids for their greater efficiency. Only, the automakers aren’t putting out a hybrid version of your favored delivery van. What do you do? You go aftermarket!
Indeed, that’s precisely what Coca-Cola did a whole decade ago! Way back in 2014, the soft-drink giant set about purchasing hybrid Chevy Express vans to get its product where it needed to go. Only, GM wasn’t producing hybrid vans back then. So where’d they come from? Coca-Cola turned to an outside company to upgrade the Express for greater efficiency and less emissions.
The company behind the technology was known as XL Hybrids. It was once a promising startup, founded by MIT graduates and working out of Boston. The aim was to save fuel for commercial vans and trucks. They achieved that, only to find that success in the world of business isn’t the easiest to come by.
The XL technology was fairly straightforward. It involved fitting a van or truck with an electric motor that sat between the transmission and rear differential of the vehicle. The vehicle also gained a battery to store energy, and a controller to make everything work and transmit telemetry for monitoring.
Working with rear-wheel-drive commercial vehicles made the installation neat and tidy. The motor installation required new driveshafts and an additional crossmember, but otherwise, there was plenty of room to fit the motor in most vehicle applications that XL developed. Batteries typically lived underneath the body, towards the rear of the vehicle—at times in place of the original spare tire location.
In most cases, the installation of the hybrid equipment was separate enough that the vehicles would still go to the original automotive OEM for regular servicing. Installation could take as little as four hours in some cases.
This setup allowed the electric motor to provide power to the rear wheels in tandem with the regular combustion engine. In turn, it could also take power from the wheels to provide regenerative braking.
Just like other hybrid cars, this system provided better fuel efficiency in two primary ways. First, harvested energy during regenerative braking that would otherwise be wasted as heat. Second, the electric motor boosted low-speed acceleration with its instant-on torque, offsetting an area where engines are typically inefficient. We’ve got a full technical explainer on the merits of hybrid drive if you need to brush up on the engineering. In any case, the XL hybrids were working in exactly the same way as any other Honda or Toyota hybrid out there.
In 2012, XL announced that it had converted a Chevrolet Express 2500 van to hybrid drive. One of the company’s earlier conversions, it featured a 2 kWh lithium-ion battery pack, and a 53 hp electric motor. The company claimed at the time that it could net a 25% boost to EPA city fuel economy. The technology would later be rolled out to larger Chevy Express and GMC Savana models like the 3500, along with trucks like the Chevy Silverado, Ram 2500, and the Ford F-250. Later work saw the company develop systems for a range of Class 2-6 vehicles, including buses and box trucks.
Going with commercial vehicles was a sage move. Trying to wedge a hybrid drivetrain into a commuter car would be very difficult. You’d find precious little space to stash a motor and battery, and you’d probably compromise cargo room and cabin space to make it work. That is, if you could integrate it at all. In contrast, a commercial vehicle makes it easy. They generally have a big driveshaft with plenty of room around it under the body. Hacking in a motor there isn’t so hard, as XL demonstrated multiple times. Similarly, there’s often ample space to stash a small hybrid battery to provide the necessary juice.
Headline Users
Coca-Cola is perhaps the biggest name that relied on XL Hybrids (later XL Fleet) vehicles. The company took on over 100 Chevrolet Express service vans by 2014, using them as delivery vehicles.
The initial fleet was successful enough that Coca-Cola purchased a further 140 examples of converted Chevy Express 3500 vans in 2015. These were slated for use as service vans for technicians attending to Coca-Cola’s vending and fountain machines. The vans were able to travel 20 percent farther on a tank of gas in the Coca-Cola fleet use, netting serious savings for the company.
“The reason we went with this technology is because it’s very simple,” said Tony Eiermann, Coca-Cola’s fleet manager at the time. “The biggest thing for Coca-Cola is if for any reason this system fails, we can still operate the van. It goes into a bypass mode.”
Not wanting to miss out on the fun, Pepsi would eventually get on board, too. Outside of the big names, smaller users found the hybrid technology attractive. Organizations seeking to cut their carbon footprints looked to XL Hybrids to offer more efficient commercial vehicle solutions.
Yale University ran a small shuttle bus with the XL Hybrid system, and CalVans purchased 154 GMC Savanna vans with the technology, too. Other notable users included elevator company ThyssenKrupp, Harvard University, and a New York City school bus contractor.
Sticky Endings
The company once looked set for long-term success. In 2020, the Boston Globe reported that the company was valued at more than $1 billion as it looked to go public. However, the pandemic struck hard, slowing production plans and playing a role in the company missing its revenue forecasts for 2021. A hefty wrench had been thrown in the works.
Just two years later, the prognosis was more dire. Having merged with a Special Purpose Acquisition Company to go public, the company shortly dumped its whole hybrid conversion business. The company shut down its engineering division and its production lines, laid off a whole bunch of workers, and changed its name. Now known as Spruce Power, it offers “clean energy solutions,” but nothing in the automotive space.
Sadly, this story isn’t about the continued victories of a proud Boston startup. The company was obviously able to develop hybrid retrofit technology, and targeted it well to the commercial market. Ultimately, though, the world of business is a tough one to navigate, and good product alone won’t always get you through.
Image credits: XL Hybrids
Thanks to Andrew Vance for the tip!
Edison Motors is working on diesel hybrid electric conversions now… Please interview them! (Deboss Garage is doing a series on Youtube of the process)
No mention of how much the conversion cost or estimated payback period. If this was a slam dunk, I’d think somebody would jump in to replace these guys, especially with the cheaper battery costs compared to a decade ago.
I came here to say this
It seems to me that back when they were just getting started they said the payback period was something like 3-5 years in fleet use.
Of course it’s dependent on miles accumulated per time period, but that sounds like a reasonable payback. There’s quite a few hybrid city transit buses running these days.
Seems like there are still plenty of folks out there that would be willing to buy this as a self install kit.
Great article timing!
One of these was in front of me in traffic last night… and I wondered where they got the hybrid Chevy Express.
I remember these. They demoed a vehicle for us probably 8-10 years ago. We (my employer) buys a *lot* of vehicles. The culture is also really conservative and we don’t tend to buy much of anything that hasn’t already been proven in production for at least a year unless it’s a handful for a pilot. Fuel costs are indeed a huge potential savings in operating costs. Police patrol vehicles are a particularly good use case for a hybrid powertrain, with lots of time sitting.
Ford discontinued the civilian hybrid explorer because the demand for the police one was so high!
We’ve bought many hundreds of PIUs and the only ones that aren’t hybrids are maybe ~50 that were bought because there was too long of a wait for hybrids. The fuel cost savings are huge and pay for the purchase cost delta in 2-3 years.
For a short period of time XL offered a set up for Crown Victorias. In that case the battery took up a portion of the trunk space.
I feel like there’s another article’s worth of story behind these two sentences. Did they not recover from the chip shortage/supply chain problems? Did the arrival of EV vans make conversions less attractive? Did the SPAC screw them (which is my guess)?
Sheesh, that’s depressing. Yet another really good idea gutted by “investors”.
Given what they were doing with the technology, cashing out was a crucial step. Or rather, cashing out before getting big enough that the OEMs start building their own as factory-installed was.
Perfect timing. Saw one of the branded Coca Cola XL vans in front of a convenience store on my commute this week and wondered how that program was going.
We’re valued at a 1 beelion dollars, what should we do? Throw out the business model that made us successful. Was Tavares (not pictured) involved this this company at any point?
Frankly, I thought the article was going to reveal the technology didn’t deliver on it’s promise, but that doesn’t appear to be the case.
They probably didn’t have a CEO making $50M a year, that was the problem. You need proper executive compensation to attract talent like Carlos Tavares.
I believe they also got their hands slapped by the SEC for doing the old recognizing projected future revenue as real revenue today thing and claiming options and deposits as actual orders to goose their reported sales numbers
The fact of the matter is, making cars is hard and expensive, and XL wasn’t actually profitable doing it, despite the lofty revenue claims. Taking in $1 billion doesn’t mean much if you spent $2 billion to do it, for instance (I don’t have the actual figure, may not be that extreme, just an example)
Another example of a solid business concept killed in an attempt to go public and cash out.
I would love one of these systems for my Express 4500 ambulance turned RV.
I was looking at 2012 (I think) or newer Expresses because it seemed like the 6spd transmission was a notable fuel economy improvement. On my camper conversion, I don’t know that hybridizing would be worth it since a lot of miles are highway driving, but for fleet vehicles this seems great (and to be able to get the parts from a scrapped one and throw them on a home build would be pretty great). I seems like it should be easily applies to most commercial vehicles built on one of those platforms and all it would take for Thomas or Collins or whoever to adapt it to their mini-busses is maybe a unique driveshaft length. Hard to believe someone didn’t swoop in to buy the tech/IP/patents when they were being liquidated.
Mine is a 2011 with the 6.6L Duramax and a six speed auto. It averages about 15 mpg on the highway or commuting to work. That is better than expected but diesel is also about 25% more than 87 octane where I live.
I’m wary of diesels, mostly because I’m not as comfortable working on them but also because of the fuel cost. At the time I was looking for vans (2018-19) it wasn’t as big of a difference in fuel cost and I was already putting premium in my other cars. But with diesel costs lingering up there, now that I’ve been looking at mini-buses I’m still trying to avoid the duramax ones.
So many good and beneficial business operations are developed, get investor attention and funding to expand and grow, then are killed by the investors when they realize it’s not a magic infinite-growth free-money glitch.
On the one hand, this is impressive stuff. It should’ve been successful.
On the other hand, it smacks of something you would’ve bought from the Warshawsky catalog (that’s JC Whitney to the rest of you).
That’s how it *should* be! Gimme a dodgy mail order retrofit for my F250!
Most of the time, these hybridization/electrification conversion companies don’t surprise me when they don’t work out. This one does…seems like a really simple and effective solution to saving fleets fuel.
I was working as a service tech for Coca-Cola when these came through. While I didn’t receive one some of my coworkers did. They said they drove heavier and not as quick. It wasn’t until they went into the dealer for service that we became aware that this was not a GM installed accessory. Our own in-house service department wasn’t even aware. some of these units spent months at the dealer, and I’m not totally uncertain that the hybrid device wasn’t disconnected.
My employer has a F-250 conversion. It does improve the gas mileage while the battery charge lasts. It does not Regen much. The truck now has about 40,000 mi on it and the universal joints on the rear portion of the drive shaft sound like they are knackered. Also the battery takes up the forward half of the truck bed. It is a giant black box in the summer heat I am sure is not doing the battery any good. I think it might improve the fuel mileage about 5%. Again while the charge lasts.
XL fleet has posted on their website instructions on how to remove the equipment from the vehicle.