German P3: ‘TCO of electric trucks already lower than diesel’

German consulting firm P3 has published a whitepaper comparing the total cost of ownership (TCO) of battery-electric trucks to traditional diesel trucks in regional and long-haul transport scenarios. In conclusion, electric trucks are already cheaper to run in both scenarios, but with a few asterisks.

P3 used an “industry average” in their calculations for the TCO of both e-trucks and ICE trucks. They accounted for all up-front and running costs, including the installation of charging infrastructure at the depot, while neglecting any subsidies and driver costs, which vary over time.

Battery replacement and residual value are still uncertain

However, the significant omission in the BEV table is battery replacement, as the study is based on five years, and the battery is usually warranted for eight years. It is also unclear how long truck batteries typically last, as most models have only been launched in recent years. The same goes for residual values, although we can expect early e-trucks to be worth less than more advanced models with better efficiency and range.

4% TCO advantage for EV in region-haul, 11% in long-haul

P3 concludes that, in a regional-haul scenario with a daily route of 200 to 300 km and a yearly mileage of 60,000, electric trucks offer a 4% TCO advantage compared to ICE trucks. The lower consumption, service and maintenance, tolls and insurance, and tax costs, therefore, compensate for the higher acquisition cost and investment needed for charging infrastructure.

With long-haul transport, meaning 350 to 500 km per day and 100,000 km per year, the advantage increases further to 11%, as the lower running costs have an even more significant impact. However, the caveat here is that not many battery-electric trucks offer a usable range of 500 km, while fast highway charging infrastructure is still limited for e-trucks.

The advantage could increase even further with more efficient and longer-range e-trucks, such as the Tesla Semi. However, the availability of this model or alternatives from traditional truckmakers is still uncertain.

This matches PwC’s 2022 prediction that electric trucks would become cheaper than diesel from 2025 onward, while the International Council on Clean Transportation (ICCT) was more cautious, with a projected cost parity in this decade.

“Leasing and subscription options to compensate for high cost needed”

P3 concludes that in a sector heavily focused on cost savings due to slim margins, e-trucks already form a viable alternative to ICE trucks in terms of TCO. However, the higher initial cost forms a barrier for many transport companies, which may not be able to install the charging infrastructure needed or whose routes may not be suited for electric trucks.

P3 pleads for more flexible acquisition models, such as leasing or subscription options, and also for the charging infrastructure to spread the costs over time and reduce the barrier to entry.

Operators can also customize P3’s TCO calculator to enter their specific data, such as ownership period, mileage, and charging behavior, and choose particular truck models to see a direct TCO comparison for their situation.