Improving the fuel efficiency of hulking commercial vehicles is a seriously important consideration for fleet managers who want to reduce operating expenses and for people in the communities where these vehicles work who don't like diesel exhaust. Remember, going from six to nine miles per gallon has a much bigger impact than on annual fuel use than going from 36 to 39 (see this Greenlings). So, it's good news that Frost & Sullivan is predicting a huge increase in the number of hybrid commercial vehicles on the roads in North America and Europe in the coming six years.

Frost & Sullivan's latest study, "Strategic Analysis of North American and European Hybrid Truck, Bus and Van Market," found that there were 4,100 hybrid commercial vehicles in use in 2009 but that by 2016 there will be 222,000. That may not be huge compared to the total number of commercial vehicles in use around the world, but it is a growth of a lot of percent. Hybrid commercial vehicles in this case refers to "light commercial vehicles, medium commercial vehicles, heavy commercial vehicles and buses."

Part of the growth, especially early in the time frame, will be due to incentives and federal grants. Frost & Sullivan Global Programme Manager, Sandeep Kar, said another reason commercial hybrids will be popular is that:
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 fuelling infrastructure. 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.
[Source: Frost & Sullivan]


PRESS RELEASE

Incentives and Federal Grants to Propel the Adoption of Hybrid Commercial Vehicles in North America and Europe, Finds Frost & Sullivan

LONDON – 2 August, 2010 – The hybrid commercial vehicles market in North America and Europe is fuelled by the benefits hybrids offer over conventional vehicles. Better fuel efficiency, lower emissions and fewer maintenance costs are all highly desirable features, especially in sprawling mega cities and increasingly congested urban clusters. In the short-term, incentives and federal grants are expected to propel the adoption of hybrids.

New analysis from Frost & Sullivan (http://www.automotive.frost.com), Strategic Analysis of North American and European Hybrid Truck, Bus and Van Market, finds that the hybrid truck, bus and van market is expected to grow from 4.1 thousand units in 2009 to 222 thousand units by 2016. The products covered in this research service are: light commercial vehicles, medium commercial vehicles, heavy commercial vehicles and buses.

"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 fuelling infrastructure." says Frost & Sullivan Global Programme Manager, Sandeep Kar. "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, the return-on-investment (ROI) potential is a key determinant for adoption of new technologies. Fuel price volatility, government incentives and low lifecycle costs associated with hybrid trucks are all in favour of hybrid commercial vehicles.

However, hybrid trucks feature energy storage systems, control and power electronics and rotating machines, which are expensive technologies creating considerable cost barriers to potential adopters. Furthermore, 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," explains 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," concludes Kar.

If you are interested in more information on this study, please e-mail Monika Kwiecinska, Corporate Communications, at monika.kwiecinska@frost.com, with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country.

Strategic Analysis of North American and European Hybrid Truck, Bus and Van Market is part of the Automotive & Transportation Growth Partnership Services programme, which also includes research in the following markets: Strategic Analysis of North American and European Electric Truck and Bus and Van Market and Comparative Analysis of Global Emission and Safety Regulations for Commercial Vehicles. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 40 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com.

Strategic Analysis of North American and European Hybrid Truck, Bus and Van Market

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