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Hybrid commercial vehicles market to grow, but...

August 03, 2010 // Christoph Hammerschmidt

Hybrid commercial vehicles market to grow, but...

The market for hybrid truck, bus and vans is expected to explode over the coming years, says market research company Frost & Sullivan. However, before demand can take off, the high upfront cost associated to this class of vehicles needs to come down.

Driven by fuel price hikes, government incentives and low lifecycle costs, the market for commercial hybrid vehicles in Europe and North America is expected to skyrocket: It will expand from 4100 units in 2009 to 222.000 units in the year 2016, calculates Frost & Sullivan analyst Sandeep Kar.

Before however the run on HEV commercial vehicles can begin, a number of conditions has to be satisfied. In the first place, these conditions refer to the still high upfront cost for these vehicles. For instance, the vocational application of commercial trucks and buses involves frequent replacement (every four to five years) of the batteries, which are among the most expensive components of the HEV powertrain. Other ingredients of the HEV powertrain such as control and power electronics as well as rotating electric machines are also contributing to the high costs of these vehicles.

Despite government incentives, tax rebates and other grants, the upfront investment is still high enough to deter many potential customers. Standardization of the key enabling technologies would create relief since it would not only reduce R&D cost and complexity but also could function as a “foundation for aggressive price reduction strategies”, says Kar, adding that these reductions “are necessary for stoking market growth”.

There are also other factors that help to drive the acceptance of commercial HEVs. This class of vehicles, for instance exerts the lowest pressure on the existing energy and transportation infrastructure of all alternative powertrain technologies, Frost & Sullivan says. It also requires the least modification to the fuelling infrastructure.

Currently, private fleets have emerged as early adopters of hybrid commercial vehicles, Kar added. Robust volume growth however could only be attained if for-hire-fleets would start to use commercial HEVs across the board.

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