In its Strategic Analysis of North American and European Hybrid Truck, Bus and Van Market study, Frost & Sullivan points out that the growth will also be fueled by the benefits of the technology, including better fuel efficiency, lower emissions and fewer maintenance costs.
"Amongst alternative powertrain technologies and fuels, hybrid commercial vehicles exert the least pressure on the existing energy and transportation infrastructure and require only minimal modification to the current fueling infrastructure," said Sandeep Kar, Frost & Sullivan global programme manager. "This aspect of hybrid commercial vehicles is acting as one of the strongest market drivers in North America and Europe, attracting governments, commercial vehicle manufacturers, and potential consumers alike towards supporting and accepting hybrid commercial vehicles."
In the commercial vehicle industry, adoption of new technologies is often determined by their return on investment. With fuel price volatility, government incentives and low lifecycle costs associated with hybrid trucks, this market can offer an attractive option, the analysis says.
However, hybrid trucks feature energy storage systems, control and power electronics and rotating machines, which are expensive technologies creating considerable cost barriers. Storage systems such as batteries must be replaced every four to five years based on the vocational application.
"Currently, the high upfront cost associated with hybrids is countered with federal grants, incentives, and tax rebates," said Kar. "Although such incentives offer relief in the short term, for hybrids to be commercially viable in the long term, the upfront cost difference should reduce considerably."
Private fleets in North America and Europe have emerged as early adopters of hybrid commercial vehicles. However, robust volume growth can be attained through the penetration of for-hire fleets.
"Standardization of key enabling technologies will not only reduce R&D expenses and complexity but also create a foundation for launching aggressive price reduction strategies that are necessary for stoking market growth," said Kar.