Jan has more than 10 years of experience in industrial automation and manufacturing research. Jan is leading Interact Analysis’ APAC operations and is also research director for our industrial automation and robotics research.
To stay ahead of the curve, off-highway machine builders and vendors should set electrification plans in place now.
As ever-stricter emissions standards come in around the world, off-highway machine builders and engine manufacturers will be forced to respond. Ultimately internal combustion engines will be phased out.
Globally, the overwhelming majority of low emission zones are in Europe (See figure 1), with city-level regulations and bans over the use of diesel and petrol cars beginning to emerge from 2025. India and China have committed to similar bans from 2030 and 2040 respectively.
Balance the prospective challenges of these new regulations with the continued reliance on specialist off-highway vehicles, like bulldozers, excavators, loaders, tele-handlers, aerial work platforms and lift trucks – the backbone of many industries – and the challenges for users, manufacturers and their supply chains becomes clear.
There’s increasing confidence that these challenges are not insurmountable though. Work has already begun; high profile construction and mining initiatives in Oslo, Gothenburg and London are aiming to challenge the belief that heavy industry goes hand in hand with higher emission levels.
The argument over higher associated costs – often quoted in the on-highway vehicle world – is less restrictive to industry. Indeed, within the B2B sector there is more emphasis placed on the ‘total cost of ownership’; essentially, if the forecasted cost over this lifespan provides a satisfactory return on investment then the larger initial outlays, which are typical currently for electric vehicles, are less of a concern.
In many cases, the longer-term fiscal benefits of employing hybrid or all-electric powertrains are compelling. Electric motors do not require the service attention of engines, such as oil changes, filter changes, or hot and cold temperature fluid requirements. Lower weight, rapid-charging batteries with vastly increased run-times have been developed.
However, it is clear that these technologies don’t yet have the track record or reputation for durability and reliability that would be required to spark widespread migration. Put simply, there’s a lack of confidence in their long-term viability.
One of the major challenges associated with on-highway electric vehicles – both passenger and commercial – is the provision of adequate charging facilities. This, coupled with the capacity of both the local and national electricity grid infrastructure to cope with large numbers of vehicles charging at the same time, means vendors of electric motor-based products have taken the opportunity to adopt new business models.
For example, in the commercial vehicle market, vendors have found selling a complete solution – including charging infrastructure, grid connection and consultation – has enabled new revenue streams. There is opportunity here for a vendor to do the same in the off-highway market, particularly with so few off-highway machine builders or suppliers focusing on an infrastructure solution which caters to the specific needs of businesses in this industry.
Also of note is the work that has begun towards standardising equipment required for hydrogen fuelling. A cross-industry group of on-highway vehicle and infrastructure companies has signed a Memorandum of Understanding (MOU) for hydrogen fuelling components, meaning different brands and operators can rely on the same, basic, standardised infrastructure.
For off-highway vendors, this presents the benefit that much of the work will be done already and there won’t be the need to duplicate effort when it comes to fuelling infrastructure.
While the technologies involved with electrification of vehicle powertrains are still in their relative infancy, and the apex of widespread adoption is still some way off, the overall direction of travel is clear.
Cost, infrastructure and general levels of confidence and belief in the technology all need addressing before mainstream acceptance occurs. This, when balanced against ambitious public-sector targets, means the growth of off-highway vehicle electrification is not without challenge.
However, there are clear opportunities for off-highway machine builders and vendors to set in place plans to keep them ahead of the curve. If the future is indeed electric, as it seems it will be, now is the time to explore where you fit in this bold new landscape.
For more information on our Off-Highway Vehicle research, please contact us at firstname.lastname@example.org