Fleet electrification in the road freight market

Freight forwarders find decarbonizing road transportation a complex task to achieve. It is not enough to introduce alternative fuels; companies need to cooperate and share their knowledge and best practices. To overcome this issue, many forwarders have either introduced electric vehicles or have partnered with companies that provide sustainable logistics solutions.

In the transportation sector, emission of CO2 is a major concern, and it becomes important to acknowledge the issue, particularly in trucking. According to the European Commission (EC), “lorries, buses, and coaches account for more than a quarter of GHG emissions from road transport in the EU and over 6% of total EU GHG emissions.”

As the most advanced and developed segment of transportation, trucks have demonstrated significant progress in adopting innovative solutions and technologies to address CO2 emissions. This commitment to reducing their environmental impact has led to a positive change in the industry and sets a strong example for other sectors in the transportation landscape. While hydrogen trucks are still in development, electric trucks present a seemingly viable solution to move forward toward a greener future, as they do not emit any exhaust gasses and/or noise while on road.

Given the significant impact it has on emissions, logistics companies are making significant efforts to improve efficiency and reducing emissions.

For instance, in June 2023, Maersk purchased 25 Volvo FH electric trucks in Germany, as a new initiative to reduce GHG emissions in hinterland container transports. This strategic investment highlights the company’s commitment to decarbonizing global logistics and to becoming a net-zero company by 2040 across all business areas and all modes of transport. The company aims to set a new standard for inland container transports by investing in e-trucks. The transition to electric vehicles aligns perfectly with the company’s core values of environmental responsibility and innovation. By utilizing advanced technologies, Maersk plans to reshape the landscape of logistics and reinforce its position as a frontrunner in decarbonizing global logistics.

In March 2023, DHL Supply Chain introduced UK’s first fully electric Volvo heavy duty tractor units. The four Volvo FM electric trucks are designed for high-capacity deliveries operating at 40 tonnes and directly replace diesel vehicles on a range of activities. Featuring Volvo’s largest 540kWh battery which provides 666hp, the zero-emissions trucks have a range of up to 300km/180 miles, allowing them to complete full round-trips servicing DHL’s retail and automotive customers across the UK.

“Today marks an important milestone in our journey towards alternative fuel vehicles. The size and capability of these trucks make them a truly viable alternative to diesel as they fully meet our needs and those of our customers. Following our introduction of the UK’s first 16-tonne rigid electric truck in late 2020, we’re proud to continue to lead the way in electric commercial transport.” says Saul Resnick, CEO DHL Supply Chain UK & Ireland.

Recently, DB Schenker also moved away from diesel delivery vehicles toward all-electric trucks and vans that could significantly reduce CO2 emissions. DB Schenker partnered with Volta Trucks; a Stockholm based company for the largest electric order in Europe. The fully electric 16-ton Volta Zero is in testing and will be used in DB Schenker’s European terminals to transport goods from distribution hubs to the city centres and urban areas. The Volta Zero is purpose-built full-electric 16-ton vehicle explicitly designed for inner-city logistics, reducing the environmental impact of freight deliveries in urban centres. Designed from the ground up with a pure-electric range of 150 to 200 km (95 – 125 miles), the Volta Zero will eliminate an estimated 1.2m tons of CO2 by 2025.

As per an article by the International Council on Clean Transportation and published by Girteka, “Battery-electric trucks are expected to dominate new registrations of heavy-duty vehicles in the European market by 2040, while hydrogen fuel-cell trucks will probably play a secondary role. ETs have the potential to provide significant CO2 reductions at relatively low additional direct manufacturing costs. From a compliance cost perspective, it will be cheaper to electrify most truck segments than to significantly improve diesel technologies to comply with the CO2 reduction targets.”

However, despite the fleet electrification investments made by some of the largest logistics companies, in 2022, diesel trucks remained the dominant choice for buyers in the EU, accounting for 96.6% of total new registrations, according to ACEA. In addition, despite significant growth last year, electrically-chargeable vehicles still made up only 0.6% of the EU truck market.

While e-commerce has grown significantly in the past five years, COVID-19 has amplified this growth. It is expected it will accelerate even more with consumers now demanding a greater level of service and ‘need-it-now’ delivery. This increase in demand is boosting the number of delivery vehicles in cities worldwide resulting in greater congestion and significant increases in greenhouse gases. Therefore, the introduction of environment friendly vehicles for logistics operations becomes even more relevant.

Source: Ti Insights

Author: Meghna Mishra

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