First and Last Miles by Cargo Bikes: Ecological Commitment or Economically Feasible? The Case of a Parcel Service Company in Paris

Abstract

Urban logistics is a key step in distribution chains. It implies the use of trucks in congested areas, and generates numerous externalities (congestion, noise, pollution, etc.). Supply chain configurations and consumer behaviors are undergoing deep changes, with a significant increase in the intensity of urban logistics and a diversification of delivery channels within cities. This is an important challenge for city sustainability, as urban logistics is an essential economic activity, and yet the source of intense negative externalities. Numerous directions are currently being explored to rethink urban logistics, such as drones, cargo bikes, crowd logistics, and so forth. However, the economic and environmental relevance of these technologies is not yet perfectly clear. This paper focuses on the conditions for the financial sustainability of cargo bikes compared with electric light commercial vehicles (LCVs). The analysis is based on real data, provided by the parcel service company DB Schenker. The dataset consists of 600,000 operations made in Paris over two months. Operations with electric LCV are assumed to be identical to conventional LCV; the cost comparison is based on a total cost of ownership approach. Operations with cargo bikes assumes that eligible shipments are first brought to micro hubs within the city by electric LCV, then delivered by cargo bike. The numbers and locations of micro hubs are optimized. Results show that a cargo bike solution can be more cost-efficient than electric LCV with a few micro hubs located where the demand is densest, but they can only be relevant financially in those conditions.