With an eye on what it calls the equitable electrification of heavy-duty port transit, Oakland-based Forum Mobility, a provider of zero-emission trucking services, announced two initiatives focused on the company’s core mission, with each having an eye on the future.
One initiative heralded by Forum is the closure of its $15 million Series A funding round, as well as its $400 million joint venture, with both serving as the beneficiaries of a fund led by CBRE Investment Management (IM) focused on providing comprehensive, zero-emission charging and vehicle solutions for drayage truck fleets and also drivers.
Forum officials said that Homecoming Capital was also an investor in the funding round, while also investing $100 million into the joint venture, adding that capital also came from Amazon’s Climate Pledge Fund.
The company said that a core objective of the joint venture with CBRE focuses on installing electric truck depots in the ground at various California-based ports, including the Port of Long Beach and the Port of Oakland, among others. And it added another goal, for Forum Mobility, is to help small independent motor carrier fleets make the transition to all-electric, in advance of the implementation of California’s CARB (California Air Resources Board) regulations. These regulations would require the state’s entire roughly 30,000-truck drayage fleet to be zero-emission by 2035, with Forum observing that the California Energy Commission estimates that the state will need 157,000 medium- and heavy duty-vehicle chargers by 2030.
“We are building a comprehensive charging network for heavy-duty trucks to make the transition to electrification,” said Matt LeDucq, CEO and co-founder of Forum Mobility, in a statement. “This network will need a lot of infrastructure and real estate, and CBRE IM is the perfect partner to help us build charging where it's needed most. Fleets can bring their trucks to our network, or we can provide electric trucks bundled with charging. Today we can provide a Class 8 electric truck, and all its charging needs, at a monthly price that’s competitive with diesel—without the emissions. With new rules coming soon from the California Air Resources Board, we help fleets and drivers looking to make the jump to electric.”
In an interview with LM, LeDucq described Forum Mobility as a company that provides drayage drivers with an easy solution to transition to truck electrification. Laying out a basic example, he said a carrier gets a fully-charged truck located at one of Forum’s secure depots, including a maintenance package and a staffed depot for a fixed price per month.
“We can aggregate a lot of trucks and do a single depot, and we can get down operational and capital costs and get that done very efficiently to deliver the lowest cost-per-mile to our customers,” he said.
Addressing the specifics related to the joint venture with CBRE, LeDucq said more than 2,000 megawatts of infrastructure are needed for the electric depots. Putting that into perspective, he said that represents hundreds of thousands of acres and more power than California’s largest nuclear power plant.
“There is an immense amount of infrastructure to build that can’t be within the physical footprint of these ports,” he said. “We are working with the Ports of Los Angeles and Long Beach [and Oakland], and we are in discussions with the Port of San Diego. We need so much real estate and land outside of these ports on those major corridors that it just cannot happen with the ports. It is also why CBRE is an awesome partner. To have the real estate partnership we get from CBRE will be incredible. There are just so many billions of dollars of infrastructure to build. Our company is rooted in infrastructure; we have built $20 billion worth of infrastructure on the team. It is an exciting way to build, and CBRE gave us that.”
The joint venture and Series A financing are viewed as being interchangeable, LeDucq said, as they will provide the capital to grow Forum’s business, staff, and technology, calling Forum the “most capital-intensive start-up that has ever been started,” with the joint venture capital providing the facility to put those assets into, as it is all managed and overseen by Forum.
At the moment, LeDucq said Forum has depot sites in development inside ports and more outside of ports, with a key focus on finding high-quality pieces of real estate, with a lot of power that can house a large number of trucks.
“We are looking at facilities that we can put 50-to-200 heavy-duty trucks into and be able to put those online in the next 12-to-24 months,” he said. “We are an infrastructure company, and we want to build infrastructure. And we are looking for good sites where we can build; they have to be on the major corridors, in or adjacent to a port or along the major drayage corridors to take out to the distribution centers. If you look at the California ports and where all of those containers go, the vast majority of them go out along a corridor out to a big hub of distribution centers. We are building our depots near those ports and distribution centers along the way and between the two.”
In terms of building a business for a fleet of any size to participate in, LeDucq explained that with 33,000 registered drayage trucks in California, 80% of those trucks are independent and small-fleet operators. And with that as a backdrop, he said that as Forum builds its business out, it needs to build a business for the largest customer segment to be able to access, which, in California, is the small fleet side.
What’s more, he said that Forum has a company mission to make the transition to electric both equitable and accessible.
“When you look at what is happening in California, is that California is knocking the oldest trucks off of the registry every year,” he said. “Next year, the 2010 will no longer be allowed on a port, and whatever leaves the registry in 2024 must be replaced by a zero-emission vehicle. On one hand that is great for the [environment] and the communities adjacent to the ports. In Wilmington, Calif., you have a 98% greater chance of contracting cancer than if you live in the broader LA basin, and if you live in West Oakland, you have double the asthma rates.”
These mandates have been put in place for very just reasons, in that there is a need to environmentally clean up areas in close proximity to ports, according to LeDucq.
“The flip side is that the economic justice is not always aligned with that,” he said. “Who has the oldest and dirtiest trucks? It is not the private equity-backed drayage fleet operator. It is the little fleet. Our goal as a business is to be able to create a business model that is accessible for all fleets, and the depot model is the way to do that. We build a big depot and fill it with a lot of trucks, and it is a third-party depot and not anybody’s property but our own. And we can aggregate and scale and offer a subscription to that depot. That has proven to be a way for all fleets to access zero-emissions trucks, in a fully kind of truck-as-a-service model that we provide.”
Looking ahead, LeDucq noted that there are some important regulatory milestones to keep an eye on, as they relate to truck electrification, including California’s Advanced Clean Fleets rule, which is expected to be voted on in April, and focuses on helping to ensure that zero-emission vehicles are brought to market.
And he added that, in terms of the business itself, there are enough trucks, real estate, and capacity to grow “many, many hundreds of billions worth of assets,” with the reality being that California needs more than $10 billion of heavy-duty infrastructure, for drayage alone.
“When you look at what has to happen over the back half of this decade, the grid needs to expand,” he said. “We need more grid capacity for a host of reasons. Heavy-duty trucking is one of them, and there is also medium- and light-duty as part of a general wave of electrifying everything going on right now. That is going to require investors in utilities and large municipal utilities in every state with these types of goals to get ahead and expand the grid, because we will run out of grid if there is not some proactivity that starts today.”