Cost, Regulation, and Legislation to Drive Commercial Vehicle Electrification Adoption

Market-leading commercial vehicle manufacturers, strategic suppliers and well-funded start-ups are racing to deliver a plethora of different battery electric solutions from delivery vans to big rigs and specialty vehicles. ABI Research, a market-foresight advisory firm providing strategic guidance on the most compelling transformative technologies, finds upstarts like Thor Trucks and SEA Electric challenging industry leaders and going head to head with firms like Daimler Trucks, Volvo and China's BYD for market share in key verticals and geographies. 

"Heavy-duty vehicles are drawing the most attention and competition including Daimler, Tesla, and Nikola (hydrogen-electric), however, the best near-term use cases stem from shorter, consistent routes such as last-mile delivery and passenger buses," states Susan Beardslee, Senior Analyst at ABI Research. "Companies like Proterra and BYD are leading contenders, along with Daimler and Volvo for buses. Start-ups like Arrival, Chanje and Workhorse are battling Daimler for a share of the lucrative last mile delivery market, fueled by the rush of e-commerce."

Additional innovation comes from last mile linkage to UAV's, as Workhorse tested with UPS, Chanje's additive range, Geely-owned Caocao Zhuanche's differentiated Mobility as a Service business model and Arrival's autonomy-ready, modular design. Traditional suppliers such as BorgWarner and Cummins are pivoting to add electric vehicle technologies to generate power. Volkswagen acquired 17% of OEM Navistar to add medium-duty EVs to its portfolio.

While current penetration of consumer auto electric vehicles largely remains in the lower single digits, a combination of factors is propelling commercial usage. These include the cost of fuel, tightening emission and noise regulations, and decreasing battery costs. Multiple plans for autonomy are underway from Tesla to Arrival to Uber's Otto to Peterbilt/Embark and PACCAR. These will likely depend on long-range battery technologies to enable.

These findings are from ABI Research's Hot Tech Innovators: Commercial Vehicle Electrification report. This report is part of the company's Intelligent Transportation & eFreight research service, which includes research, data, and analyst insights.