The commercial vehicle sector is one of the largest and toughest decarbonization problems in transport. These vehicles represent a small share of the global vehicle stock but account for a disproportionately large portion (37%) of road-transport CO2 emissions. There isn’t a single obvious pathway that fits every type of commercial transport, since the sector encompasses everything from short urban journeys with vans and buses to long-haul heavy trucks.

This report aims to explain what factors are influencing the viability of different technology options.  The authors review recent research, reports, and policy developments to compare insights from total-cost-of-ownership (TCO) analyses and to consider how geopolitical, industrial, and geographic contexts shape preferences for certain technologies.

Key messages

• Context and strategic interests shape low-carbon technology pathways.
  National priorities, legacy industries, existing infrastructure, and geopolitical relationships all influence which technologies scale. These factors directly affect infrastructure rollout, access to cost-competitive energy, and the availability of advanced technologies.
• Cost competitiveness of long-range, low-carbon trucks remains uncertain.
  Battery-electric trucks (BETs) currently hold a technological lead, but studies show mixed results on total cost of ownership (TCO) for long-haul operations. Variations in assumptions about purchase costs, technology maturity, and the costs of energy and infrastructure make the relative competitiveness of alternatives highly context-dependent.
• Diversification versus scale in the decarbonization race.
  Original equipment manufacturers (OEMs) are right to pursue multiple pathways to avoid technological lock-in and policy misalignment. However, diversification must be balanced against the economies of scale required for commercial viability — and the urgency of deep decarbonization, where battery-electric vehicles (BEVs) currently lead in technological maturity and market deployment.