In order to reduce the environmental impacts caused by the transport sector, autonomous and electrified on-the-road modular vehicles (otrm) could be a solution. By separating the drive unit from the transport unit, they enable use cases for various transport tasks and reduce individual and motorized transport and its generated emissions. Therefore, the goal of this study is to assess the environmental impacts from cradle to grave by applying the LCA methodology for a defined otrm—the U-Shift—vehicle fleet considering a specific use case relative to a reference vehicle fleet. The results indicate that the U-Shift fleet reduces the life cycle environmental impacts in a range of 3–28% for all of the seven impact categories, which are analyzed in detail. While emissions from the use phase are similar, U-Shift has an environmental benefit in the production phase due to a low amount of resource-intensive driveboards. Considering the early development stage of U-Shift, several measures are discussed, addressing the material and configuration aspects of the vehicles as well as optimized use case applications, which promise further impact-reduction potential.