Path to scale: 4 critical fixes ZEVs need for TCO parity

LAS VEGAS—Stalled in the “Messy Middle,” commercial transportation decarbonization desperately needs a clear, stable policy to unlock fleet investments in zero-emission vehicles (ZEV). 

While manufacturers roll out multi-path technology strategies—battery electric, fuel cell, and renewable fuels for advanced engines—adoption remains fundamentally driven by economic viability rather than mandates. 

Moving forward, purchasing decisions are shifting toward risk mitigation, long-term partnerships, and AI-powered operational efficiency.

What they're saying: Volvo Group is pursuing a three-pronged decarbonization strategy because there is no silver-bullet solution for all trucking applications.

Speaking during an ACT Expo workshop on clean transportation market dynamics on May 4, Lars Johansson, head of TTI Truck Technology at Volvo Group, which produces Volvo and Mack trucks in North America, urged policymakers to prioritize “stability and clarity rather than perfection”.

Johansson blamed the lack of clarity in policies, incentives, and infrastructure for keeping trucking companies from investing in new powertrain technologies.

The economics of adoption: For commercial fleets, ZEV adoption is driven by economics that actually work and requires solutions tailored to specific fleet operations, according to the more than a dozen panelists who took the workshop stage on the opening day of ACT Expo, the largest industry conference focused on advanced transportation technology and clean fuels. 

Funding breakthroughs: Alan Gassler of PLM Fleet argued that total cost of ownership (TCO) parity is achievable, especially for Class 3 to Class 6 vehicles.

Gassler noted PLM Fleet has successfully secured funding for 100% of its electric vehicle placements.

"House of cards" warning: Robert Cruess, CEO of Zeronox, which retrofits traditional equipment to battery electric, warned that if a business has to rely on incentives to survive, it is "built on a house of cards".

Cruess highlighted that electric retrofits for Class 3 to Class 8 vehicles can reduce costs up to 33%.

Cost of inaction: Nico De Golia, director of cloud logistics sustainability at Microsoft, noted that his company evaluates ZEV proposals by weighing the cost of reducing a ton of CO2 against the continued exposure to volatile diesel prices.

Operational mastery: How predictive analytics drives utilization and profit

The AI advantage: Amid the prolonged freight recession, carrier focus has shifted to extending life cycles and driving operational efficiency. Predictive analytics and generative artificial intelligence are enabling fleets to plan better and identify weaknesses.

• Penske’s Catalyst AI tool has reduced idling by 13%, saving fuel.
• WattEV uses AI for route optimization and charging sequencing at its facilities.
• Microsoft uses an internal AI tool nicknamed “Carbon Copilot” to find optimization opportunities for renewable fuel deployments and streamline administrative tasks.
• De Golia estimated that this Microsoft tool has saved 10,000 staff hours annually.

Yes, but: North America’s ZEV scaling ultimately hinges on resolving four key areas that are holding back growth.

• Policy and funding: Policy stability remains a critical investment signal, but TCO parity is achievable in certain duty cycles through strategic grant funding and clean fuel programs.
• Operational mastery: Carriers should focus on extreme optimization, utilizing AI and telematics to boost equipment utilization, reduce idle time, and eliminate expensive charging downtime.
• Financing risk: Uncertainty around ZEV residual value is stalling adoption. The industry needs commercial instruments or policy backstops to create minimum asset values and provide financial stability for long-term purchasing decisions.
• Infrastructure and labor: Robust, funded investment is immediately needed for charging infrastructure and structured workforce training to move beyond pilot programs and reach commercial scale.