FedEx is going all-electric. It will invest $2 billion in a zero-emissions delivery fleet and other carbon-cutting measures by 2040, it said.

• FedEx said Wednesday it planned to replace its entire parcel pickup and delivery fleet with electric vehicles by 2040.
• This is part of the company's plans to make its global operations carbon-neutral by then.
• FedEx would invest $2 billion into electric vehicles, sustainable energy, and carbon sequestration, it said.

FedEx's entire parcel pickup and delivery fleet will be zero-emission electric vehicles by 2040, the delivery giant said Wednesday, as it announced plans to make its global operations carbon-neutral.

The company planned to invest $2 billion into vehicle electrification, sustainable energy, and carbon sequestration, it said.

FedEx would replace existing vehicles over the next 19 years, it said. It said that by 2025, half of all its FedEx Express global pickup and delivery purchases would be electric, rising to 100% of all purchases by 2030.

FedEx is set to be the first company to take delivery of General Motors' EV600 vans, and is due to receive its first vehicles in late 2021.

FedEx also said it would continue to invest in alternative fuels to reduce aircraft and vehicle emissions. It would also work to reduce fuel consumption in its aircraft, it said.

The delivery company would also give Yale University $100 million to help establish the Yale Center for Natural Carbon Capture, it said.

The center is designed to research methods of carbon sequestration to remove and store the Earth's excess carbon, with an initial focus on helping offset greenhouse gas emissions equivalent to current airline emissions, FedEx said.

FedEx also said it would offer carbon-neutral shipping and sustainable packaging solutions.

"While we've made great strides in reducing our environmental impact, we have to do more," Mitch Jackson, FedEx's chief sustainability officer, said.

"The long-term health of our industry is directly linked to the health of the planet, but this effort is about more than the bottom line - it's the right thing to do."

The news comes as automakers are increasingly pivoting to electric vehicles, a market currently dominated by Tesla but facing competition from cheaper Chinese rivals.

General Motors, the US' largest automaker, said it would end all sales of gas-powered vehicles by 2035 and would invest $27 billion in electric and autonomous vehicles over the next five years.

Jaguar Land Rover, meanwhile, said it would go all-electric by 2039. Volkswagen's electric vehicle sales increased more than three-fold in 2020, and even Apple is reportedly building its own electric car.

BMW started selling the Mini Electric in 2020, which is the lowest-cost electric car currently available in the US, Insider's Tim Levin reported.