China’s Commercial Vehicle Road Map for Carbon Neutrality

Nov 2023

On the 25th of October, China’s Society of Automotive Engineers (SAE) at its annual meeting, released the ‘Commercial Vehicle Carbon Neutral Technology Roadmap 1.0’. The roadmap outlines a feasible route to decarbonise all commercial vehicles by 2060, in line with China’s 2060 net zero ambition. This study is a reflection of how the government will plan for commercial vehicle decarbonisation in China.

EV Penetration

By 2035, China aims for half of all passenger vehicle sales to be battery electric or plug-in hybrid (BEV or PHEV), with the remaining 50% hybrid or mild hybrid (HEV). China is currently outpacing its electrification targets and our analysis forecasts that by 2035, 74% of sales will be BEV, with a further 6% PHEV. To date commercial vehicle electric penetration has been significantly lower and will continue to be lower in the future. The electrification of commercial vehicles poses its own unique challenges compared to passenger vehicles.

Commercial vehicles account for approximately 12% of China’s total vehicle fleet, however, contribute to just over half of all transport emissions. The SAE identified more than 200 commercial vehicle applications considering cargo, transport distances and road conditions. Each different scenario and user condition will require alternative technological solutions. However, many of these technologies are still in their infancy.

Four Areas for Decarbonisation

The SAE expects the decarbonisation of commercial vehicles to follow four New Energy Vehicle (NEV) avenues.

  1. Improved internal combustion engine (ICE) efficiency. Traditional ICE vehicles will remain important in the commercial vehicle sector, but improvements in engine efficiency will help reduce carbon output in the short term. Additionally, the increased usage of HEVs in the sector will reduce emissions.
  2. Zero-carbon combustion engines. The emergence of zero-carbon combustion engines, such as hydrogen and hydrogen-ammonia, have great potential in the short and long term. These engines have the advantage of low acquisition costs, and high reliability. However, technical obstacles include a high total cost of ownership, and inadequate infrastructure.
  3. Vehicle electrification. This is considered one of the main avenues to achieve net zero. Compared to passenger vehicles, BEV penetration in the commercial vehicle sector has remained relatively slow. BEV use in the commercial sector is generally limited to short distance scenarios. However, as cruising range increases, charging infrastructure expands and battery swapping continues to become more prevalent, its penetration rate will increase in medium and long-distance applications.
  4. Fuel Cell Electric Vehicles (FCEV). Currently, hydrogen powered FCEVs in the commercial sector are focused on demonstration projects. The main challenges to this avenue is technology development, high total costs of ownership, and a lack of hydrogen supply networks. As the technology advances, infrastructure will become more abundant leading to further widespread adoption.
Different Types of Commercial Vehicles Have Different Development Paths

Commercial Vehicles can be broadly split into the sections heavy-duty trucks, medium-duty trucks, light-duty trucks (LDV), buses, and others. Before 2035 heavy-duty trucks will reduce emissions through engine efficiency improvements and HEV technology. After 2035, FCEVs and charging vehicles will become the focus, supplemented with battery swapping and zero-carbon combustion engines. Traditional ICE vehicles will continue to exist. The SAE equates this to an NEV penetration rate of 9% by 2025, 25% by 2030, 55% by 2040. By 2060, 5% of heavy-duty trucks will continue to be traditional ICE, in remote areas.

For medium-duty trucks, its development path will be dominated by pure electric technology, supplemented by battery swapping and FCEV technologies. The SAE expects an NEV penetration rate of 15% by 2025, 40% by 2030, and over 85% by 2040. Similarly, ICE vehicles will remain in use in rural areas. The trajectory of LDVs will follow that of passenger cars, primarily becoming BEVs, with space for battery swapping and FCEV technologies. Finally, buses are expected to achieve 90% NEV penetration by 2040. It concluded that peak emissions for commercial vehicles could be achieved before 2030.

Rho’s Evaluation

Decarbonisation of the…


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Sources: 21st Century Business Herald