ANAHEIM, California—Trucking is in unfamiliar territory. As the industry forges ahead on a path toward sustainable transportation and decarbonization, Daimler Truck North America urges stakeholders to work together and “move at the speed of right.”
That’s at least the sentiment DTNA President and CEO John O’Leary brought to this year’s Advanced Clean Transportation Expo here in Southern California.
“For more than a century, the business of global logistics and the entire global economy has been dependent on a single source of propulsion technology,” O’Leary said during the opening keynote address at ACT Expo. “Diesel has dominated our industry, and it has dominated our lives.”
“To say that diesel propulsion is incredibly efficient is undeniable,” O’Leary added. “To say that it has propelled us, our economies, and humankind forward in measurably positive ways is undeniable. And to say that time for change is necessary is similarly undeniable.”
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That change involves trucking’s journey to zero and near-zero emissions, which likely will comprise alternative-energy solutions like battery-electric, hydrogen fuel cell, or hydrogen internal combustion engines. Beyond those alternatives, however, and arguably most important to fleets is total cost of ownership (TCO) that is equal to or better than what is currently available, O’Leary added. Infrastructure for refueling or recharging also must be ubiquitous, he added.
“In order to deliver competitive TCO, we must ensure that we are doing things the right way, making sure that we are building the complete ecosystem right from the start and with the future in mind,” O’Leary advised. “In our company, we’ve worked to establish the supply chain to bring the cost per kilowatt hour for batteries down as low as we can—on a path to price parity. Although this is still far away from delivering the TCO for the nation’s fleets, we are working on the tangential components to deliver economies of scale and benefit TCO.”
The infrastructure dilemma
The vehicles and their TCO, however, are just two components of the transformation part of the equation, O’Leary noted, emphasizing that charging infrastructure remains the greatest challenge.
“Infrastructure buildouts are flailing,” O’Leary said. “We’re destined to fail to meet the ambitious goals of the state, of our country, and of the world until emphasis is put on meeting the charging needs of the electric fleet.”
For example, O’Leary said, current lead times for DC charging depot projects are, in general, running over two years. And when it comes to charging for medium- and heavy-duty electric vehicles, the situation is compounded by greater complexities, O’Leary noted.
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Recently, DTNA, NextEra Energy Resources, and BlackRock Alternatives forged ahead with a charging infrastructure venture called Greenlane. The goal is to design, develop, install and operate a U.S. nationwide, high-performance zero-emission public charging and hydrogen fueling network for medium- and heavy-duty battery-electric and hydrogen fuel cell vehicles.
The more than $650 million joint venture began in 2022, and Greenlane's first site will be in Southern California, and multiple additional sites are being acquired along various freight routes. The network of charging sites will be built on critical freight routes along the East Coast and West Coast and in Texas.
“At Daimler Truck, we’ve calculated the investment in charging infrastructure to meet nationwide 2032 climate targets and it will take roughly $52 billion just for medium- and heavy-duty vehicles,” O’Leary said, noting that cost does not include the cost for real estate to site installations. “More immediately, to meet California’s requirements, 30 DC chargers per day need to be opened between now and 2026.”
“It’s clear that we cannot do this alone,” O’Leary added. “There are more than 3,000 electric utilities in the United States. To meet the requirements of regulatory action, we need utilities to act now in order to create a bare minimum of operability.”
During a May 1 media roundtable discussion here at ACT Expo, O’Leary noted that various alternative-energy technologies are coming from all directions and will play a role in trucking’s decarbonization efforts.
“We intend to be one of the winners just like we have been for a while,” O’Leary said during the press briefing. “We understand that just because we have been a winner for a while in that past that it doesn’t mean we will continue to be one. We have to fight and work super hard to earn that every single day, and times like this are when you’re at most risk. I think that has energized our team to realize that it’s a new game now, and just because we won the old game doesn’t mean we will win the next one.”
Fleet demand remains strong
Despite market headwinds and supply chain disruptions, DTNA is seeing strong customer demand for new diesel trucks today, and as O’Leary put it, there is “no need to take the foot off the pedal anytime soon.”
DTNA serves 80% of the largest fleets in North America, and due to various lingering supply chain disruptions, most of the average fleet age has crept up and fleets are operating outside the sweet spot they’d prefer, O’Leary noted.
“Most of them are all too anxious to get vehicles,” he explained. “When the phone rings, it’s usually someone saying, ‘I need 1,000, 2,000, or 5,000 more trucks.’”
“We see that on not just highway long haul but also on the vocational heavy-duty side through the passage of the Inflation Reduction Act and some of the infrastructure bills and construction projects starting to take off, too,” he added.
That said, O’Leary noted that trucking is a cyclical business that could change in a day amid some sort of macroeconomic event that would prompt fleets to cancel orders. And diesel, he reassured, isn’t going away anytime soon.
“Diesel vehicles are getting ever cleaner, and we continue to see those as the majority source of transportation for a long time,” O’Leary indicated. “We’ve said at least until 2039, and we know there are parts of the country and certain applications where diesel will continue to make sense.”
