There’s nothing new about electric trucks;they have labored on the streets of major cities across the world since the first decades of the 20th century.
Fleet managers prized these trucks for their strong pulling power and greater reliability than vehicles powered by early, fitful internal combustion engines (ICEs). And now, in a high-tech second act, both incumbent and nontraditional makers of commercial vehicles across most weight categories and a variety of segments are launching new “eTrucks.”
A century on, the question is, why now?
We believe the time for this technology is ripe and that three drivers will support the eTruck market through 2030. First, based on total cost of ownership (TCO), these trucks could be on par with diesels and alternative powertrains in the relative near term.
Second, robust electric-vehicle (EV) technology and infrastructure is becoming increasingly cost competitive and available.
Third, adoption is being enabled by the regulatory environment, including country-level emission regulations (for example, potential carbon dioxide fleet targets) and local access policies (for example, emission-free zones). At the same time, barriers to eTruck adoption exist: new vehicles must be proved to be reliable, consumers need to be educated, and employees, dealers, and customers will require training.
Furthermore, there are challenges in managing the new supply chain and setting up the production of new vehicles.
Based on the analysis of many different scenarios—which are highly sensitive to a defined set of assumptions—our research shows that commercial-vehicle (CV) electrification will be driven at different rates across segments, depending on the specific characteristics of use cases.
Electrification is happening fast, and it’s happening now
McKinsey developed a granular assessment of battery-electric commercial vehicles (BECVs) for 27 CV segments across three different regions (China, Europe, and the United States), three weight classes, and three applications. The three weight classes are light-duty trucks (LDTs), medium-duty trucks (MDTs), and heavy-duty trucks (HDTs), while the three applications are urban, regional, and long-haul cycles. While our modeling also includes other alternative fuels and technologies such as mild hybrids, plug-in hybrids (PHEVs), natural gas, and fuel-cell electric CVs, this article focuses on full electrification.
Our model concentrates on two scenarios, “early adoption” and “late adoption,” to help place bookends for each weight class and geography (Exhibit 1). The two scenarios reflect different beliefs regarding core assumptions, such as the effectiveness of any regulatory push, the timing of infrastructure readiness, and the supply availability, which results in delay or advancement of uptake.
Read the article at McKinsey&Company.
