Short-Haul Success, Long-Haul Ambitions: The State of Electric Truck Adoption

State Actions Paving the Way: Policy Momentum for Electric Trucks

Years after the electric car took off, we still await the launch of long-haul electric trucks capable of carrying heavy cargo over extended distances. Several companies have made big promises, but we are still waiting to see the result of years of funding for research and development. However, this could soon change following the success of recent short-haul electric freight pilot programs across the US. We expect the migration to electric truck fleets over the coming decades to support the freight industry's decarbonization goals and the acceleration of the green transition.

State Actions Paving the Way: Policy Momentum for Electric Trucks

The logistics and transport sector contributes over a third of global CO2 emissions. It is the largest carbon emitter in several developed countries. It is also considered a hard-to-abate industry, as developing the battery technology required to power larger vehicles, such as trucks, sea vessels, and planes, is highly complicated. However, following years of increased investment in the sector, several companies are now conducting pilot programs to test advanced battery technology in electric trucks.

Several states are backing electric freight plans and pressuring companies to adapt. California, New York, New Jersey, Massachusetts, Oregon, and Washington have all introduced schemes to expand their electric truck fleets, offering financial incentives to companies to purchase battery-powered vehicles.

Many automakers have been developing electric truck models for several years and have begun to launch short-haul options, hoping to deliver mid- and long-haul models soon. Tesla is developing its Tesla Semi model, a fully-electric, Class 8 tractor that is expected to travel up to 500 miles on a single charge, using a 900 kWh battery. Meanwhile, the trucking giant Volvo is manufacturing its Volvo FH and Volvo FM models, with large orders from companies hoping to increase their EV freight fleet.

Short-Haul Success Breeds Optimism

Over the last few years, California has seen great success in rolling electric trucks on short-haul routes, as the state has used them to service its major shipping ports in Los Angeles and Long Beach. Several fleets of Tesla’s Class 8 tractor are already being tested by companies across California, with funding support from the California Air Resources Board. And Uber Freight is carrying out its first electric truck pilot program on Southern California routes.

The North America electric truck market is expected to be around $16 billion in 2024, which could increase to as much as $65 billion by 2029, growing at a CAGR of roughly 30%. In the U.S., this reflects the anticipated rise in demand in response to national policies, such as the Inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL), which encourage companies nationwide to decarbonize operations by offering financial incentives and policy support.

While we are optimistic about the potential growth of the industry, there are several hurdles that automakers must overcome to provide electric trucks on a commercial scale. More significant investment must be directed towards developing batteries capable of powering heavy freight vehicles over long distances.

These investments will likely support innovations in other transport sectors, such as the maritime and aviation industries. In addition, innovations in battery technology will help drive down EV costs to compete with diesel alternatives.

Public-Private Collaboration and Knowledge Sharing

In addition to more significant private investment in batteries, the government and private companies must invest heavily in new transmission and charging infrastructure to support the rollout of electric trucks. This includes the development of fast charging stations in logistics hubs and along significant freight routes.

We believe that between 70% and 90% of truck charging points will be at hubs and destinations, implying large space requirements in these facilities. This can be supported at a regional level by creating national legislation for electric truck manufacturing and uptake, including financial incentives such as tax breaks and grants.

Infrastructure Needs for a Widespread Rollout

Greater collaboration between the public and private sectors will help increase the number of pilot schemes being carried out and support information sharing to enhance electric truck development. There has been great success in short-haul pilot schemes in the last few years, which will encourage the rollout of more short-haul freight fleets and help manufacturers progress in developing mid- and long-haul electric trucks over the next decade.


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