UK Sees £2.4 Billion Opportunity with the Rise of Zero Emission Trucks and Buses

The Advanced Propulsion Centre UK (APC) revealed that the UK stands to gain an estimated £2.4bn from the production of zero-emission heavy-duty vehicles (HDVs). This promising outlook encompasses battery packs, electric drive units, fuel cell systems, hydrogen tanks, and high-power converters, all pivotal for low-carbon HDVs.

Heavy-duty vehicles, including heavy goods vehicles (HGVs) and buses, account for about a fifth of total emissions from the UK transport sector. To meet climate goals, the government has committed to ending the sale of new, non-zero-emission HGVs under 26 tonnes by 2035 and requiring all new HGVs to be zero-emission by 2040.

The latest APC report projects the UK will manufacture approximately 35,000 HGVs and buses by 2035, with at least 75% of these vehicles expected to produce zero emissions at the tailpipe. Among these, roughly half are predicted to be battery-powered, while a quarter will likely be fuel-cell electric vehicles utilizing hydrogen and oxygen to generate electricity.

This shift towards greener heavy trucks signifies a significant market opportunity for the UK, driven by the demand for high-value components essential for zero-emission HDVs.

"Across these five component areas, we've identified an estimated UK opportunity of £2.4bn, with £870m value in just fuel cell systems alone, and £790m in batteries," said Dr Hadi Moztarzadeh, head of technology trends at the APC. "This is a significant increase from 2025 with just £480m total opportunity in the UK, and from 2030 with £1.5bn total opportunity in the UK."

The report emphasized that maximizing this opportunity's potential hinges on closer cooperation between the UK government and industry. It echoes recent appeals from the Climate Group, a green business organization, which urges governments to collaborate with businesses to unlock private finance and boost investment in the shift to clean transport technologies.

"There are clearly a few key areas that businesses, especially those within the local automotive supply chain, can take advantage of, which would subsequently help the UK to lead the way across the HDV and transport sectors, particularly in fuel cell technologies," added Aditya Thiru, one of the report's authors from APC's Technology Trends team.

"To achieve this, there is the need to understand the energy infrastructure requirements to meet the 2040 zero-emission vehicle commitment for on-road heavy goods vehicles. Perhaps most importantly, however, the UK must accelerate the development of a 'minimum viable' charging and hydrogen refueling infrastructure network for heavy goods vehicles and coaches for the projected 2035 and 2040 demand."

This report follows Scania's launch of Erinion, an electric vehicle charging company, in June. Erinion aims to support the rollout of electric HGVs with at least 40,000 compatible charge points across Sweden, Norway, the Netherlands, France, Germany, and the UK by 2030. Scania, expecting a direct leap from diesel to battery power due to significant battery duration and cost improvements, anticipates selling 100% battery trucks by 2040.

The UK has recently emerged as a leader in Europe's transition to low-carbon buses. Data from the Society of Motor Manufacturers and Traders shows that nearly half of the new buses purchased in 2023 were zero-emission.