2022 will go down in history as the year the United States prepared to steal Europe’s global leadership in commercial vehicle technology. Their ultimate success is entirely up to us.
Joe Biden’s landmark climate legislation, the Inflation Reduction Act (IRA), has become the talk of the town. Its strong support for US-sourced batteries and electric cars also worries Brussels.
Less well known, the IRA also includes a $40,000 credit for large electric trucks. This will radically increase cost parity with diesel platforms. Some analysts expect electric trucks to account for more than 60 percent of new U.S. truck sales by 2030. But more than the tax break, the IRA’s fiscal stimulus to the entire supply chain, from green energy to battery production, is what makes it a killer. a weapon.
More than the tax break, it’s the financial stimulus the IRA provides to the entire supply chain, from green energy to battery production, that makes it a lethal weapon.
At COP27, President Biden struck again. The US has committed in a Global Memorandum of Understanding (MoU) to selling only zero-emission trucks from 2040. California is even considering bringing that forward to 2036. Together the IRA and the MoU constitute a license to kill: the direction of travel is clear and there are huge tax breaks available For the local supply chain to increase production in the next few years.
If Europe does not deliver an ambitious truck package of its own, it will be left behind. The world’s leading truck makers risk heading down the same path as their auto brethren, as they struggle to keep up with Chinese and Californian competition.
The European Commission is currently drafting legislation that will allow us to take back control: CO2 standards for heavy vehicles. The draft law is due to be introduced in January, and is rumored to include the European date by which zero-emission trucks can be sold, just like cars and vans. Cars and trucks share a large portion of their supply chain. If we were going electric, it would be crazy to try to keep the engines alive for trucks.
If Europe does not deliver an ambitious truck package of its own, it will be left behind.
In the world of trucking, total cost of ownership (TCO) is king. Research organization TNO has calculated that by 2035, more than 99 percent of electric freight trucks will outperform their diesel counterparts in terms of cost, while not losing an inch of operational capability.
The fact that Scania has already announced that it will go fully electric from 2040 and Daimler that it will be completely emissions-free from 2039 confirms that this is possible.
No EU country can meet its new 2030 climate targets if pollution from trucks continues to rise – trucks already account for just 2 per cent of vehicles on the road, but they account for more than a quarter of EU road transport emissions. That’s why 10 EU capitals want a 100 percent zero-emission sales target. Companies also want to move. A coalition of 44 companies, including PepsiCo, Unilever and Maersk, has just called for a higher near-term target.
The current 2030 truck CO2 target of reducing emissions by 30 percent was set at a time when electric trucks were considered impossible and fuel economy was the coolest kid in town.
Increasing this target to reduce emissions by 65 percent is the game changer we need
Increasing this target to a 65 percent emissions reduction is the game changer we need to start the transition and achieve the emissions savings and industrial scale needed.
We cannot afford to delay increased ambition until 2035 or 2040. The US IRA is challenging the EU’s industrial leadership in commercial vehicles here, now. Some significant investments in batteries and metals in the EU are already at risk of going to the US. The Tesla Semi is being launched in America, not Europe. Europe has long led the world in truck technology and innovation. Now global competition risks taking the lead from us. Strong CO2 targets from trucks and a 100 percent zero emissions target by 2035 – supported by a strong industrial policy for metal processing and green battery manufacturing in Europe – will ensure European leadership in the future, and will provide truck drivers with the clean, cheap-to-operate rigs needed to deliver goods.
