Global Commercial Vehicle Electrification Potential and Trends, Forecast to 2025

Drop in Battery Pack Price Below $100/kwh Compounded by Slew of eTruck Product Launches to Capitalise on Subsidies are Poised to Push Electrification in MD & HD Truck Segment to 11.1% by 2025 Translating to 250,000 Market Opportunity

GHG emission regulations are ever strengthening in North America, Europe, and China. Climate change concerns among the public is especially propelling the automotive industry to reduce carbon footprint. Countries are looking for options to improve air quality in their communities and to contribute to mitigation of global climate change through electrification.

This study provides an overview of the key trends in medium commercial vehicle ranging between 6.1 tonnes and 16 tonnes, and heavy commercial vehicle ranging above 16 tonnes segments of global electric truck market from 2016 to 2025. The various factors attracting adoption of electric trucks and the top challenges are studied in brief.

The study reveals that the Chinese truck market will dominate the electric truck market with aggressive plan of subsidy rollout coupled with deployment of charging infrastructure systems in large scale. China is leading the electrification and contributes to 50% of the global electric truck sales in today’s scenario, and the trend is expected to remain the same by 2025.

North America, mainly Canada and the US, is expected to be the second largest market for electric trucks, having new disruptors emerging from the market. The incentive policies and stringent emission regulations in Europe, North America, and China will motivate the buyers, and the growing consumer demand for electric trucks will be satisfied by the product line-ups planned by OEMs.

New entrants like Tesla and Nikola are expected to disrupt the North American market, while Chinese manufacturers are eyeing on export markets to uphold the market dominance in terms of electric truck sales volume. The electric powertrain adoption is poised to accelerate post 2020 due to the fall in battery prices.

This study provides a summary on the available drivetrain technologies in the industry and future adoptions. By 2025, the penetration of electrification is expected to be 28.5% in medium-duty trucks and 6.5% in heavy-duty trucks in China. In North America, the penetration of electric powertrain is expected to be 8.3% and 12.3% in medium- and heavy-duty trucks, respectively.

Several Western European countries are planning to adopt the ICE ban from 2025–2030, with expanding low-emission zones planning to ban diesel and gasoline engines. The new GHG emission regulations in Europe are pushing hard to achieve CO2 and fuel economy standards to satisfy EISA lead-time requirement. The electric powertrain adoption is expected to be 15% in medium-duty trucks and 5.2% in heavy-duty trucks in Europe.

The world of batteries is changing very rapidly making it very hard to predict the most promising battery chemistry; however, some trends are already visible when limiting to lithium-ion based batteries. With battery prices dropping nearly 80% during 2010–2017, electric vehicles have become the favourite alternative powertrain for automakers both incumbent (such as Daimler, Volvo, and Scania) and startups (such as Tesla, Orange EV, and Nikola) ahead of hybrids.

Fuel cell electric vehicles will be the future trend and will start acquiring the market from 2020 due to the intensity of energy in hydrogen and light weight, making the technology suitable for trucks.

The rapid technology developments in electrification and huge market potential are inviting new technology participants and startups to invest in the CV space, whereas the transition is compelling the existing manufacturers to adopt the next-generation technology.

With wide range of fiscal incentives and other benefits by government, emergence of eMobility value chain, and rising consumer awareness on usage benefits and cost savings, the market opportunity for electric medium- and heavy-duty trucks is predicted to be 250,000 units by 2025.