Electric Truck Popularity Set to Boom in U.S. in Future

Electric Truck Popularity Set to Boom in U.S. in Future

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The U.S. electric truck market growth is driven by low operational and maintenance costs of electric trucks, declining battery costs, and favorable government policies. These factors will accelerate the market at 51.6% CAGR during the forecast period (2020–2030). The market generated $211.5 million in 2019 and it is projected to reach $15,084.3 million by 2030. Currently, it is exhibiting the trend of deployment of such vehicles in the logistics sector, on account of the growing e-commerce industry. Several logistics companies are electrifying their fleet to optimize their operations.

The country is replacing conventional diesel trucks with electric trucks, as the latter have lesser operational and maintenance costs in comparison to the former. The electric trucks help in saving a large amount in overall component cost, as these do not require the replacement of fuel filters, spark plugs, and oils. Owing to these advantages, fleet owners are focusing on electrifying their fleets. Moreover, these trucks incorporate regenerative braking systems to attain substantial reductions in the wear and tear of breaks.

Additionally, the U.S. electric truck market growth is also facilitated by declining price of battery. The battery pack is a key component of electric trucks and reducing cost of this component will eventually curtail the overall price of these vehicles. The cost of the battery pack depends on the battery chemistry used in electrochemical cells, and this chemistry determines several performance parameters of batteries that include battery lifetime, charging time, and energy-to-weight ratio. Moreover, advancements in electric vehicle (EV) battery technology will reduce the price of batteries in the future.

Thus, the surging government support and advancing battery technology have encouraged companies, such as Chanje Energy Inc., BYD Co. Ltd., Ford Motor Co., Orange EV, Fiat Chrysler Automobiles N.V., Mitsubishi Fuso Truck and Bus Corp., General Motors Co., Tesla Inc., Workhorse Group Inc., and Nikola Motor Co., to produce electric trucks and develop charging infrastructure for such vehicles. Further, the producers of electric trucks focus on offering light-duty, medium-duty, and heavy-duty trucks to be applied in the municipal and logistics sectors of the U.S.

Moreover, categories under the propulsion segment of the U.S. electric truck market include battery electric vehicle (BEV), hybrid electric vehicle (HEV), plug-in hybrid electric vehicle (PHEV), and fuel cell electric vehicle (FCEV). Under this segment, the BEV category dominated the market in 2019 and is expected to display significant growth in the forecast period. The growth can be attributed to the rising government support in the form of subsidies and the dipping cost of batteries. Moreover, enhancements in battery technology will also promote the adoption of electric trucks in the country.

According to P&S Intelligence, California will adopt the highest number of electric trucks in the U.S., in the foreseeable future. This will be ascribed to the extensive support from the state government in the form of financial incentives and policy formulation to promote the deployment of these EVs in the state. For example, in June 2020, the California Air Resources Board (CARB) formulated the Advanced Clean Truck initiative that aspires to convert all new trucks sold by 2045 into its electric variants.

Thus, the formulation of supportive government policies and the improved features of electric trucks will promote these EVs in the U.S. in the upcoming years.

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