Case study: Freight & logistics decarbonization — a pilot that failed (and what it taught us)

Road freight accounts for approximately 29% of the European Union's transport-related CO₂ emissions, generating over 200 million tonnes of carbon dioxide annually. Despite representing just 2% of vehicles on European roads, heavy-duty trucks contribute disproportionately to the sector's climate footprint. In 2024, a consortium of logistics operators in the Netherlands launched an ambitious electric heavy goods vehicle (eHGV) pilot that promised to demonstrate viable zero-emission long-haul freight. Eighteen months later, the project was quietly shelved—but not before generating critical insights about what separates successful freight decarbonization initiatives from costly failures.

Why It Matters

The freight and logistics sector stands at a critical inflection point in the European energy transition. According to the European Environment Agency's 2024 assessment, transport remains the only sector in the EU where greenhouse gas emissions have increased since 1990, with heavy-duty vehicles representing the fastest-growing emissions source within that category. The European Green Deal's mandate to achieve a 90% reduction in transport emissions by 2050 places extraordinary pressure on logistics operators, shippers, and policymakers to accelerate decarbonization pathways.

The economic stakes are substantial. The European freight and logistics market generates approximately €1.2 trillion annually, employing over 11 million workers across the continent. The EU's Fit for 55 package, finalized in 2024, established binding CO₂ emission standards requiring new heavy-duty vehicles to achieve a 45% emissions reduction by 2030 and 90% by 2040 relative to 2019 baselines. These regulations create both compliance imperatives and market opportunities for first movers in clean freight technology.

Recent data from Transport & Environment's 2025 analysis indicates that electric trucks now achieve total cost of ownership parity with diesel counterparts for urban delivery applications (routes <300 km), while long-haul economics remain challenging. The International Council on Clean Transportation reports that European manufacturers announced over €40 billion in committed investments for zero-emission truck development between 2023 and 2025, signaling unprecedented industrial commitment to the transition.

Yet despite regulatory tailwinds and technology advancement, implementation remains fraught with obstacles. A 2024 McKinsey survey of European logistics executives found that 78% identified charging infrastructure as their primary barrier to fleet electrification, followed by vehicle availability (62%) and total cost uncertainty (54%). Understanding why pilots fail—and extracting actionable lessons—has become essential knowledge for any organization serious about freight decarbonization.

Key Concepts

Freight Decarbonization refers to the systematic reduction of greenhouse gas emissions across goods transportation and logistics operations. This encompasses direct emissions from vehicle propulsion (Scope 1), indirect emissions from purchased electricity for electric vehicles (Scope 2), and value chain emissions including fuel production, vehicle manufacturing, and end-of-life disposal (Scope 3). Comprehensive freight decarbonization strategies typically combine fleet technology transitions, operational efficiency improvements, modal shift initiatives, and demand-side interventions.

EV Charging Infrastructure for heavy-duty freight involves specialized high-power charging systems distinct from passenger vehicle networks. Megawatt Charging System (MCS) technology, standardized under CharIN protocols, delivers charging power up to 3.75 MW, enabling 80% battery replenishment within 30-45 minutes for long-haul applications. Depot charging installations typically operate at 150-350 kW, suitable for overnight or extended dwell-time scenarios. Grid connection capacity, electrical infrastructure upgrades, and demand charge management represent critical economic considerations.

Life Cycle Assessment (LCA) provides a comprehensive methodology for evaluating environmental impacts across a product or service's entire existence—from raw material extraction through manufacturing, use phase, and end-of-life treatment. In freight decarbonization, LCA enables meaningful comparison between propulsion technologies by accounting for battery production emissions, electricity grid carbon intensity, and vehicle manufacturing impacts alongside tailpipe emissions. The ISO 14040/14044 standards govern LCA methodology, while sector-specific guidance from GLEC (Global Logistics Emissions Council) establishes freight-appropriate protocols.

Fleet Retrofits involve modifying existing diesel vehicles with lower-emission technologies rather than purchasing new zero-emission vehicles. Retrofit options include diesel-to-electric conversions, hydrogen fuel cell installations, and compressed natural gas adaptations. While retrofits can extend vehicle asset life and reduce capital requirements, they typically deliver lower performance characteristics than purpose-built alternatives and may face regulatory limitations regarding emissions classification.

Heat Pumps in logistics contexts refer primarily to thermal management systems within refrigerated transport (cold chain logistics) and warehouse climate control. Electric heat pump technology offers significant efficiency advantages over conventional refrigeration units—achieving coefficient of performance (COP) values of 3-4 compared to resistance heating's 1:1 ratio. For temperature-controlled logistics, transitioning from diesel-powered transport refrigeration units (TRUs) to electric heat pump systems can reduce per-shipment emissions by 60-80%.

What's Working and What Isn't

What's Working

Urban Delivery Electrification has achieved genuine commercial viability in European markets. DHL Express's European fleet now includes over 37,000 electric vehicles completing final-mile deliveries, with the company reporting 27% lower per-parcel operating costs compared to diesel equivalents in their 2024 sustainability report. Amazon's European delivery fleet incorporated over 10,000 electric vans by mid-2025, with particularly strong deployment in Germany, France, and the UK where urban access restrictions incentivize zero-emission vehicles.

Collaborative Charging Infrastructure Investment demonstrates how shared capital burdens can accelerate deployment. The MILENCE joint venture—established by Daimler Truck, Volvo Group, and TRATON—committed to installing 1,700 high-power charging points across Europe by 2027. Early installations along the Rotterdam-Antwerp-Ruhr corridor achieved 72% utilization rates within six months, exceeding business case projections and demonstrating demand certainty when infrastructure meets route requirements.

Intermodal Shift Incentives have proven effective where rail capacity exists. Switzerland's heavy vehicle fee structure, which charges trucks €0.015-0.031 per tonne-kilometre depending on emissions class, successfully diverted 68% of Alpine transit freight to rail and combined transport modes. Austria's similar rolling motorway expansion—increasing rail-transported truck capacity by 40% since 2020—achieved per-tonne emissions reductions of 75% compared to all-road alternatives.

What Isn't Working

Premature Long-Haul Battery Electric Commitments consistently underperform projections. The Netherlands pilot referenced earlier—involving fifteen battery-electric trucks operating 400-600 km daily routes—achieved only 58% of planned utilization during its operational period. Range degradation in cold weather (losing 18-25% capacity at temperatures below 5°C), inadequate charging infrastructure spacing, and extended charging dwell times reduced effective productivity to levels incompatible with just-in-time logistics requirements.

Isolated Fleet Operator Initiatives struggle without ecosystem coordination. A 2024 analysis by Fraunhofer IML found that single-company electrification pilots achieved 40% higher total cost of ownership than collective approaches, primarily due to subscale infrastructure investments and inability to share charging capacity during off-peak periods. The lesson is clear: freight decarbonization requires collaborative infrastructure models rather than proprietary solutions.

Hydrogen Fuel Cell Deployments at Current Costs remain economically challenging. Despite significant manufacturer promotion, green hydrogen-powered trucks in 2024-2025 European trials demonstrated fuel costs 3-4 times higher than diesel equivalents per kilometre travelled. The Hyundai XCIENT fleet operating in Switzerland—while technically successful—required substantial public subsidy to achieve operational viability, with unsubsidized economics unlikely before 2030 absent dramatic electrolyser cost reductions.

Key Players

Established Leaders

Volvo Trucks leads European electric heavy-duty vehicle production, delivering over 5,000 electric trucks across the continent by 2025. Their FL Electric and FE Electric models dominate urban distribution segments, while the FH Electric targets regional haul applications up to 300 km range. Volvo's integrated approach—combining vehicle manufacturing with charging infrastructure partnerships—positions them strongly for the evolving regulatory landscape.

Daimler Truck operates Europe's largest truck manufacturing footprint and has committed €6 billion to zero-emission vehicle development through 2030. The eActros series achieved production volumes exceeding 2,000 units annually by 2024, while the eActros LongHaul variant targeting 500 km range entered customer trials in 2025.

TRATON Group (encompassing MAN, Scania, and Navistar) deployed over 3,500 electric trucks in European markets by 2025. Scania's charging-as-a-service offering—bundling vehicle leasing with depot infrastructure installation—addresses operator hesitancy regarding capital commitment.

DB Schenker represents logistics operator leadership, operating Europe's largest commercial electric truck fleet with over 2,500 units. Their "Green Lane" service offers customers verified low-emission freight options with transparent emissions reporting, commanding 8-12% price premiums in environmentally conscious market segments.

Maersk transformed container logistics sustainability expectations through their commitment to operating carbon-neutral vessels and integrated green corridors. Their inland logistics division deployed electric port vehicles and invested in rail-connected terminal infrastructure, reducing European inland emissions by 35% versus 2020 baselines.

Emerging Startups

Einride pioneered autonomous electric freight operations, achieving commercial deployments across Sweden, Germany, and the Netherlands. Their Pod vehicles eliminate driver cabins entirely, enabling radical packaging efficiency while their digital freight platform optimizes multi-modal routing. Series C funding of $500 million in 2024 positioned the company for continental expansion.

ORTEN Electric Trucks specializes in diesel-to-electric truck conversions, offering retrofit solutions for existing fleets at 40-60% of new vehicle costs. Operating from Germany, they converted over 800 trucks by 2025, particularly serving operators seeking to extend asset life while meeting urban emission zone requirements.

Hylane emerged from Cologne to provide hydrogen refuelling infrastructure specifically designed for heavy-duty freight corridors. Their modular station design reduces installation timelines from 18 months to under 6 months, addressing critical infrastructure deployment bottlenecks.

FERNRIDE develops teleoperations technology enabling remote truck operation in yard and logistics hub environments. Their system reduces labour costs for container handling while enabling electric vehicle deployment in applications where autonomous driving regulations remain restrictive.

Zemo Fleet provides fleet emissions monitoring and optimization software, helping logistics operators identify highest-impact decarbonization opportunities through granular telematics analysis. Their platform processes data from over 50,000 European commercial vehicles, generating benchmarking insights unavailable to isolated operators.

Key Investors & Funders

European Investment Bank (EIB) deployed €3.2 billion in green transport financing during 2024 alone, with specific programmes supporting electric truck acquisition and charging infrastructure development. Their Green Shipping and Freight Facility offers concessional rates for verified decarbonization investments.

Breakthrough Energy Ventures (Bill Gates' climate fund) invested significantly in freight decarbonization startups including Einride, demonstrating commercial investor confidence in the sector's trajectory. Their Catalyst programme provides milestone-based funding for first-of-kind clean freight demonstrations.

Horizon Europe (EU research framework) allocated €1.8 billion to sustainable transport research and innovation through 2027, with specific calls addressing long-haul electrification, hydrogen freight applications, and logistics digitalization. The European Partnership on Zero-Emission Waterborne Transport extends coverage to intermodal connections.

BlackRock Sustainable Investment Trust directed significant capital toward listed transportation companies meeting defined decarbonization criteria, creating equity market incentives for ambitious emissions reduction targets. Their engagement with Maersk and Deutsche Post influenced corporate climate strategy development.

Nordic Investment Bank provides specialized financing for Scandinavian freight decarbonization projects, particularly supporting charging infrastructure deployment in regions where commercial viability timelines extend beyond conventional loan terms.

Examples

1. The Netherlands eHGV Corridor Pilot (2024-2025): A Failure That Taught Us Everything

The pilot launched with genuine optimism. Fifteen battery-electric Volvo FH Electric trucks were deployed across a consortium of five logistics operators serving routes between Rotterdam port and distribution centres in Eindhoven, Venlo, and Duisburg (Germany). Initial projections anticipated 85% diesel-equivalent productivity with 78% emissions reductions.

Reality diverged dramatically. Key failure factors included:

Infrastructure Mismatch: Public charging stations along the A2 and A67 corridors achieved only 65% uptime during the pilot period, with maintenance response times averaging 72 hours. When trucks arrived at non-operational chargers, drivers faced 40-60 km diversions to alternative stations, consuming battery capacity and schedule buffers.

Temperature Sensitivity: Winter 2024-2025 temperatures in the Netherlands fell below -5°C for extended periods. Battery capacity losses reached 22% during cold spells, reducing effective range from rated 500 km to approximately 390 km—insufficient for planned route lengths without additional charging stops.

Payload Penalties: Battery weight reduced cargo capacity by 2.3 tonnes per vehicle compared to diesel equivalents. For volume-constrained freight (consumer goods, automotive parts), this proved acceptable. For weight-sensitive commodities (building materials, beverages), operators required 8-12% additional trips to move equivalent tonnage, eroding emissions and cost advantages.

Charging Time Variability: Megawatt charging delivered predicted 45-minute 80% recharge under ideal conditions. However, battery preconditioning requirements in cold weather extended actual charging duration to 70-90 minutes. Schedule-critical just-in-time deliveries became unreliable.

The pilot formally concluded after 18 months, with consortium members citing inability to achieve operational reliability meeting customer service level agreements. However, the €8 million investment generated invaluable insights: subsequent deployments focused on shorter routes (<300 km) with depot charging, reduced cold-weather operations during technology maturation, and collaborative infrastructure investments ensuring redundancy.

2. IKEA's European Distribution Network Transformation

IKEA committed to achieving zero-emission home deliveries across all European markets by 2025. Their phased approach prioritized urban fulfilment centres serving high-density metropolitan areas—Amsterdam, Paris, Milan, Barcelona, and Munich—before expanding to regional operations.

Key success factors included:

Controlled Operating Environment: All electric vehicles operated from IKEA-owned or long-term leased distribution centres, enabling purpose-built charging infrastructure without reliance on public networks. Overnight depot charging at 150 kW proved sufficient for next-day urban delivery routes averaging 120 km.

Customer Scheduling Flexibility: IKEA's delivery model accommodates customer-selected time windows spanning 2-4 hours rather than precise appointment times. This flexibility enabled route optimization software to cluster deliveries spatially, maximizing vehicle utilization while accommodating charging requirements.

Emission Transparency: Every delivery confirmation email now includes calculated CO₂ savings compared to diesel delivery, reinforcing brand sustainability positioning. Customer research indicated 23% of surveyed customers selected IKEA over competitors partially due to environmental delivery practices.

By 2025, IKEA's European last-mile fleet comprised 4,200 electric vehicles with diesel alternatives completely eliminated in 12 countries. Per-delivery emissions fell 94% compared to 2019 baselines when accounting for grid carbon intensity.

3. Port of Hamburg Rail Modal Shift Programme

Hamburg's port authority implemented aggressive incentives to shift container hinterland traffic from road to rail, recognizing that rail freight generates approximately 75% lower emissions per tonne-kilometre than trucking.

The programme combined infrastructure investment (€340 million in new rail sidings and marshalling capacity), operational coordination (48-hour advance booking requirements enabling optimized train loading), and financial incentives (€15-per-container subsidy for rail movements exceeding 300 km distance).

Results exceeded projections: rail modal share for hinterland container traffic increased from 42% in 2020 to 58% in 2024. Total port-related truck movements declined by 180,000 annually despite 12% growth in container volumes. The programme achieved 340,000 tonnes of annual CO₂ savings at a public cost of approximately €28 per tonne—substantially below carbon pricing levels required to drive equivalent behaviour change through market mechanisms alone.

Action Checklist

• Conduct granular fleet emissions baselining using telematics data to identify highest-emitting routes and vehicles before prioritizing intervention targets
• Map charging infrastructure requirements against planned electric vehicle deployment, ensuring adequate grid connection capacity exists at depot locations before vehicle orders
• Engage regional electricity distribution network operators early—grid connection upgrades typically require 12-24 months lead time in European markets
• Evaluate route profiles against current electric vehicle range capabilities, prioritizing battery-electric deployment for routes under 300 km with depot return
• Establish collaborative relationships with competing operators for shared charging infrastructure investment, reducing per-company capital requirements
• Incorporate life cycle assessment into technology selection decisions, ensuring upstream emissions from battery production and electricity generation are included in comparison with diesel alternatives
• Develop driver training programmes addressing electric vehicle operation, regenerative braking optimization, and cold-weather battery management
• Create customer communication strategies articulating emissions reduction achievements, enabling premium pricing and differentiated market positioning
• Build contingency planning for charging infrastructure failures, including diesel reserve capacity during transition periods
• Monitor regulatory development across EU member states regarding urban access restrictions, recognizing that policy timelines often accelerate faster than technology deployment

FAQ

Q: At what route distance does battery-electric trucking become economically viable compared to diesel in European markets? A: Current economic analysis indicates battery-electric trucks achieve total cost of ownership parity with diesel counterparts for routes under 300 km when combined with overnight depot charging at operator-owned facilities. This threshold accounts for vehicle capital costs (electric trucks remain 2.5-3x more expensive than diesel equivalents), reduced maintenance requirements (approximately 40% lower), and electricity costs versus diesel fuel at 2024-2025 European prices. For routes exceeding 400 km, extended charging requirements and reduced daily productivity currently favour diesel or await further battery technology advancement. The crossover distance extends when public DC fast charging is required, as commercial electricity rates at third-party stations typically exceed €0.45/kWh compared to €0.18-0.25/kWh for industrial depot connections.

Q: How should logistics operators evaluate hydrogen fuel cell trucks versus battery-electric options for long-haul applications? A: Hydrogen fuel cell electric vehicles (FCEVs) offer advantages for weight-sensitive, long-distance applications where battery mass becomes prohibitive and refuelling speed matters. However, current hydrogen costs in Europe (€8-12/kg for green hydrogen) translate to per-kilometre fuel costs 3-4 times higher than diesel. Battery-electric trucks suit predictable routes with adequate charging time windows, while FCEVs may prove preferable for truly long-haul (600+ km daily) operations once hydrogen production scales reduce costs toward the €4/kg threshold required for diesel parity. Most industry analysts project this occurring between 2028-2032 depending on electrolyser cost trajectories and renewable electricity expansion.

Q: What emissions reduction can operators realistically achieve through fleet electrification in the European context? A: Tailpipe emissions reduce to zero, but life cycle emissions depend critically on electricity grid carbon intensity and battery production impacts. In France (nuclear-dominated grid, approximately 50 gCO₂/kWh), electric trucks achieve 85-90% lifecycle emissions reductions versus diesel. In Germany (coal and gas generation, approximately 350 gCO₂/kWh in 2024), reductions range 55-65%. Poland's grid intensity (approximately 700 gCO₂/kWh) delivers more modest 30-40% reductions until renewable deployment progresses. Operators should calculate location-specific impacts using actual grid data rather than European averages, and consider renewable electricity procurement options to maximize climate benefit.

Q: What performance benchmarks indicate a successful freight decarbonization pilot? A: Successful pilots typically demonstrate: vehicle utilization rates exceeding 75% of diesel fleet equivalents; charging infrastructure uptime above 95%; total cost of ownership within 115% of diesel baseline during pilot phase (accounting for learning curve effects); driver satisfaction scores comparable to conventional fleet operations; and customer service level agreement compliance within 5 percentage points of historical performance. The Netherlands pilot described above achieved only 58% utilization and faced extended infrastructure downtime, indicating insufficient readiness for commercial scaling despite technical vehicle functionality.

Q: How do urban access restrictions affect fleet electrification economics? A: European low-emission zones increasingly restrict or charge diesel vehicle access. London's Ultra Low Emission Zone charges £100 daily for non-compliant trucks; Amsterdam will prohibit diesel trucks from the city centre from 2030; Paris and Berlin implement similar progressive restrictions. These regulations shift the economic calculus substantially: operators serving restricted zones face diesel surcharges that accelerate electric vehicle payback periods. Analysis from Transport & Environment suggests urban access fees equivalent to €25-40 per trip create electric vehicle cost parity even at current vehicle prices, making regulation-driven markets (major metropolitan areas) the logical starting point for fleet transitions.

Sources

• European Environment Agency (2024). "Transport and Environment Report 2024: Decarbonising Road Freight." EEA Report No. 15/2024.

• Transport & Environment (2025). "Electric Trucks: Market Status, Charging Infrastructure, and Policy Recommendations." Brussels: Transport & Environment.

• International Council on Clean Transportation (2024). "Electric Heavy-Duty Vehicle Deployment in the European Union: Market Status and Outlook." ICCT Working Paper 2024-23.

• McKinsey & Company (2024). "Decarbonizing European Trucking: Pathways, Challenges, and Investment Requirements." McKinsey Center for Future Mobility.

• Fraunhofer Institute for Material Flow and Logistics (2024). "Collaborative Business Models for Freight Electrification: Lessons from European Pilots." Fraunhofer IML Research Report.

• Global Logistics Emissions Council (2024). "GLEC Framework for Logistics Emissions Accounting and Reporting, Version 3.0." Smart Freight Centre.

• European Commission (2024). "Fit for 55: CO₂ Emission Standards for Heavy-Duty Vehicles—Impact Assessment." SWD(2024) 120 final.