Electric Truck Market - Growth, Trends, and Forecasts (2020 - 2025)
The electric truck market is expected to register a CAGR of over 14.30%, during the forecast period (2020 - 2025).
Some of the major factors driving the growth of the electric truck market are the enactment of stringent emission norms imposed on commercial vehicles, incentives for the adoption of cleaner and zero emission vehicles, and reduction in the fuel and maintenance costs.
Governments across the world are putting pressure on vehicle manufacturers to reduce carbon emissions caused by diesel fuel combustion and tackle greenhouse gas emissions, in turn, pushing them to invest in developing electric trucks (e-trucks). Meanwhile, low-emission zones are driving fleets to replace diesel trucks with cleaner options.
However, there are certain risks associated with the adoption of e-trucks. New vehicles must prove to be dependable and perhaps require training of customers and dealers to equip them with adequate knowledge regarding their operations. Furthermore, the inadequate charging infrastructure for electric trucks is also expected to hinder the growth of the market.
The electric truck market is dominated by major players, such as Tesla Inc., Renault Trucks, Dongfeng Motor Corporation, Hino Motors, Daimler (Mitsubishi Fuso), and Isuzu. In June 2018, Daimler AG unveiled two fully electric-powered commercial trucks, and this is likely to help the company maintain its competitive position in the market.
Key Market Trends
Increasing Demand for Electric Trucks from the Logistics Sector
The logistics industry is one of the important contributors to any country’s GDP, as expanded internet access and increased demand for e-commerce may require logistics providers to deliver to remote locations in the emerging economies. As the demand for green transportation is growing around the world and governments are backing this initiative, freight transportation, which contributes highly to carbon dioxide emissions, has been observing a reduction. Supply chain/logistics companies are actively participating in replacing their fleet with greener vehicles. For instance,
In February 2020 - CEVA Logistics in the United Kingdom started trails using electric lorries/trucks for supplying goods in Central London. The overall aim of this month trial is to find ways to reduce the impact of conventional commercial vehicles, thereby, mitigating air, noise, and congestion problems. Two 12 metric ton vehicles will operate daily from Dartford to Guys & St Thomas' NHS Foundation Trust. Along with this on-going trial, the company also partnered with Tevva, a UK-based developer of modular electrification systems for medium duty commercial vehicles, to undertake trials of the equipment to research on which can deliver the best results.
Canada’s Ovation Logistics Company announced its plans to introduce electric trucks in its existing fleet. The company will be including 5 electric trucks supplied by Nordresa. These are equipped with 160 kWh batteries that will enable them to cover their entire daily assignment on a single charge.
Sweden launched an e-highway solution in the northern part of the country. With this setup, specially designed trucks are being powered via overhead wires.
The demand for electric trucks in the logistics industry is likely to grow significantly over the forecast period, owing to the increasing stringent emission regulations, logistics companies replacing IC engines with electric fleets, logistic companies placing more electric vehicle orders, etc.
Stringent Emission Regulations are Fueling the Market Growth
With the growing environmental concerns, governments and environmental agencies are enacting stringent emission norms and laws that may increase the manufacturing cost of electric drivetrains and fuel-efficient diesel engines in the coming years.
In Europe, the European Union (EU) is committed to achieve its 20% greenhouse gas reduction target in 2020 for the second phase of the Kyoto Protocol (base year: 1990). The EU has also set the target to achieve 40% green house gas reduction by 2040 compared to 1990. By 2050, the EU aims to achieve the target of 0% greenhouse gas emission. The regulation EU 253/2014 sets the target of 147 gm of CO2 emission per kilometer for 2020 and 2021, for light commercial vehicles (LCVs), based on the NEDC (New European Driving Cycle) test procedure. The European Union set a target of 31% reduction of CO2 emission for LCVs by 2030.
In the United States, the EPA and NHTSA have proposed the implementation of the Safer Affordable Fuel-Efficient (SAFE) vehicles rule to be implemented from 2021 to 2026. The rule may set the standards for corporate average fuel economy and greenhouse gas emissions for passenger and light trucks. The Zero Emission Vehicles (ZEV) Program requires OEMs to sell specific numbers of clean and zero emission vehicles (electric, hybrid, and fuel cell powered commercial and passenger vehicles). The ZEV plan aims at putting 12 million ZEVs on road by 2030.
In China, all vehicles sold and registered after July 1, 2020 should comply with the China 6 Emission Standards. Currently, the 6A standards n(emission reduction from gasoline engine vehicles) are applied, and 6B limits (revised limits to reduce 50% hydrocarbon and 40% NOx emissions over Euro 6 standards) will be implemented from July 1, 2023. Medium- and heavy-duty vehicles are currently following China V emission standards. The latest version of China VI emissions came out in July 2018, and the implementation phase started from July 1st, 2019. All vehicles must comply with phase “a” from July 2021 and phase “b” from 2022.
The global electric truck market is mainly dominated by some of the major automotive players, such as Daimler AG, Dongfeng Motor Corporation, BYD Auto Co. Ltd, PACCAR Inc., and Scania, of which, Daimler AG and BYD Auto Co. Ltd account for a significant market share across the world.
The companies are focusing on making new strategic partnerships, investing in R&D projects, and launching new products in the market, in order to gain competitive advantage. For instance, Ford is investing more than USD 6 billion in US Michigan plant for manufacturing F-150 hybrid truck. The company is expected to introduce both an all-new F-150 and an F-150 hybrid version in 2020.
Reasons to Purchase this report:
The market estimate (ME) sheet in Excel format
3 months of analyst support
Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.Download eBook