China leads the world in zero-emission vehicle (ZEV) deployments, ZEV and battery manufacturing capacity, and ZEV incentives. Despite this leadership, the zero-emission truck (ZET) market in China has not experienced the same success as its zero-emission light-duty passenger vehicle and bus segments. Slow deployment can be attributed to a multitude of technical and economic challenges in MHD truck electrification, while the unique characteristics of the Chinese truck market have made these challenges particularly outstanding. Over 70% of truck drivers in China are independent owner-operators and earn low wages, making the upfront cost of MHD ZETs (almost double the cost of diesel trucks) unbearable by these independent owner-operators, which have limited financing options compared to larger scale logistics companies.
However, these barriers are not insurmountable. An integrated program of strong national ZET targets, regulations, and incentives can provide systematic guidance for the industry and provincial governments to take action to accelerate ZET commercialization and improve the financial feasibility of ZETs until their total costs of ownership reach parity with conventional trucks. Below is a list of recommendations for China:
- Announce Strong Targets to Maintain Chinese Leadership
- Implement Strong Regulations to Provide Market Certainty
- Extend Targeted and Timebound Incentives
- Continue Investment in Battery Electric Technologies
- Prioritize Zero-Emission Tailpipe Technologies
- Leverage Zero-Emission Bus Investments to Accelerate Zero-Emission Trucks