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Tech4.25.2024
9 min read

Why now is the time to transform your freight operations

Tech4.25.2024
9 min read

Why now is the time to transform your freight operations

When it comes to sustainability, why should businesses focus on transportation? And why leverage battery electric technology, as opposed to alternatives? Another critical question to consider: why act now, as opposed to later? In this article, we shed light on what’s driving some of the world’s leading shippers to make the switch today.

While many sustainability managers, innovation managers and business leaders are eager to pivot away from diesel-based freight operations, the ideal timing for the transition is still a question to many – partly due to a commonly held misconception that sustainable road freight belongs in the too-hard-to-crack basket. Some ponder whether the technology is mature or question whether it’s too costly to implement. The reality is that the technology is already able to cater to the vast majority of use cases, and electric freight can be deployed with a strong business case today, enabling businesses to achieve significant and measurable CO2e reductions by transforming how they move without high upfront investments. 

Read on to discover four essential reasons why now is the time to transform your freight operations: the regulatory factor; the impact factor; the “winning technology” factor; and the cost-effectiveness factor.

The regulatory factor

By rolling out intelligent and sustainable transportation now, not only will businesses make strides towards their CO2e-reduction goals, but they will also be prepared for the rising presence of diesel bans and restrictions. Cities and countries around the world are tightening regulations on heavy-duty vehicles due to air and noise pollution, compelling shippers to adapt in order to avoid additional costs or disrupted operations. 

Another important regulatory consideration is Scope 3 emissions. Robert Ziegler, Einride’s GM EMEA, says many businesses are looking to transportation as a way to tangibly reduce their Scope 3 emissions: “Under the Corporate Sustainability Reporting Directive, businesses which operate in the EU – including global businesses that operate in the EU – will have to report on their Scope 3 emissions by 2025. That means the emissions of 2024. Which means they need to start doing something today so they can meet their targets.” 

The impact factor 

Making an impact – fast – is another reason businesses should set their sights on transforming transportation, as Isabelle Ji, Einride’s Senior Director of Solution Architecture (US) explained during a sustainability-focused session of the Einride Webinar: “You can achieve immediate results, with close to 95% fewer CO2 emissions when you decarbonize road freight with technologies such as battery electric vehicles.” 

“That’s because you’re eliminating emissions at the source, there are no tailpipe emissions at the exhaust, and you have the option of charging the electric vehicle with renewable energy instead of grid based electricity – and that helps you achieve that 95% CO2 reduction.” 

You can achieve immediate results, with close to 95% fewer CO2 emissions when you decarbonize road freight.

Isabelle Ji Senior Director, Solution Architecture & Strategy North America

Not only does this mean businesses can further their impact with respect to their own sustainability efforts, but it also helps address the concerning fact that road freight alone is responsible for 7-8% of global greenhouse gas emissions. By making the switch now, businesses can lead the way, positioning themselves as drivers of change. 

“This industry will keep growing. It’s projected to grow by approximately 11 percent per year for the rest of this decade. So there’s lots of work and opportunity ahead of us to reduce the emissions while also meeting the increase in demand,” said Isabelle.

The “winning technology” factor

Another key reason why businesses should transition to sustainable road freight now is because from a technological perspective, battery electric is “ready to go”. Isabelle Ji explained that the current technology for battery electric vehicles (BEVs) can already meet most of the road freight demands: “Battery electric trucks are here, and they’re able to address short and medium-range use cases, which makes up the majority of freight volumes today.” Indeed, according to the US Department of Energy, 87% of US truck freight tonnage was shipped less than 400 kilometers (250 miles). 

When comparing options for sustainable road freight against four key criteria (cost-effectiveness, scalability, environmental sustainability, and whether it is future-proof), it is clear that battery electric is the winning technology for decarbonizing freight at scale. 

To see how battery electric technology compares to two of the most discussed “sustainable” alternatives – HVO biofuel and hydrogen-powered fuel cell technology – you can read our Insights article comparing the technologies in detail.

Table of alternative fuels based on four factors

For businesses with goods to move, making the switch sooner rather than later can unlock various benefits beyond the volumes of CO2e curbed. These include:

  • Gaining a competitive advantage in the market 

  • Faster deployment of subsequent waves by securing assets 

  • Mitigating risk of unexpected/sudden cost increases

  • Mitigating risk of supply chain disruption

Further supporting the case for transforming freight operations is the fact that these activities proactively mitigate carbon emissions, and that they do so with comparatively low carbon abatement cost.

The cost-effectiveness factor

One of the myths about electric freight is that electric freight operations are too expensive for businesses to deploy today. But as Robert Ziegler explains, the reality is that when deployed intelligently, electric freight operations can be highly cost-effective. 

“Already today, electric operations are on the kilometer cheaper than diesel operations, and that difference will only increase over time. So we’re expecting this to grow really really quickly. 

Also, the OEMs have picked up on this. Every OEM nowadays is producing electric heavy goods vehicles, and the numbers are increasing every day. So the time is right now to make the change.”

Already today, electric operations are on the kilometer cheaper than diesel operations, and that difference will only increase over time

Robert Ziegler General Manager EMEA

The research paints a similar picture. In the US, the Department of Energy predicts that by 2030, nearly half of the electric trucks in the US will be cheaper to buy, operate, and maintain than diesel trucks. And the European Federation for Transport and Environment predicts that from as early as 2025, electric trucks will outperform diesel trucks in most use cases in terms of total cost of ownership (TCO) – and, by 2035, all new electric freight trucks in Europe will be cheaper to run, will drive just as far, and will be able to carry as much cargo as diesel trucks. 

Niklas Reinedahl, Einride’s GM for North America, says decarbonizing transportation is something that should be high on the agenda for any business with goods to move: “What you will see is that if you fast-forward 5 or 10 years from now, you might risk sitting with stranded assets if you haven’t initiated that switch to a more sustainable – and I mean from a business perspective – transport technology in your supply chain.”

“Based on the economics you see in this, we are at that inflection point where you can start to engage with this technology with no regrets.” 

Fleet of four Einride electric trucks

How to successfully scale up electric freight operations – starting now

With battery electric being the winning technology, how can businesses realize the transition in a stepwise and cost-effective manner? This question was explored in detail during another session of the Einride Webinar: “Unlock cost-effective electric freight operations”.

Perhaps the most important metric when it comes to achieving a successful deployment is asset utilization. In Robert Ziegler’s words, “You need to make the assets sweat.” This applies to both vehicles and charging infrastructure. The more usage you get from your physical infrastructure, the more cost-efficiency you leverage.

Another important consideration is to roll out electric freight in a stepwise manner, ensuring the first wave comprises the routes and lanes most prime for electrification, as they can yield high vehicle and charging asset utilization. 

We are at that inflection point where you can start to engage with this technology with no regrets.

Niklas Reinedahl General Manager North America

Niklas Reinedahl explains that shippers can achieve cost-competitiveness by partnering with Einride, as they can leverage digital tools – based on unique data and proprietary models – to carve out a clear roadmap to efficient and sustainable freight operations. He says this represents a departure from the traditional way of planning freight transportation, which was to simply add on more trucks as the need arose: “Now, thanks to digital capabilities, you have the opportunity to approach this from a scaled-out view from the very beginning.”

Why digital intelligence is key in scaling up electric freight operations

Digital intelligence isn’t only critical when it comes to mapping out the transformation; it also plays a critical role when it comes to tactically planning freight operations. One advantage of shipping with Einride is that businesses don’t only benefit from having their goods transported by electric vehicles; they also benefit from reliable and highly coordinated intelligent freight operations. In fact, many clients have seen a reduction in the number of vehicles needed to move the equivalent capacity, as a result of making the switch. 

This equates to an increase in overall equipment effectiveness (OEE), and it’s made possible thanks to the intelligent freight platform Einride Saga. As Robert Ziegler explains, Saga is digitizing the full operation from origin to destination: “We’re integrating the telematics of the truck with the telematics of the charging infrastructure, with the driver – whom we’re instructing exactly what to do when; when to stop, where; how much to charge; and so on.” 

By aggregating the four essential domains of data – transportation demand, driver information, vehicle telematics, and charging telematics – and combining this foundation with advanced algorithms, Einride Saga unlocks transportation flows that are not only free from tailpipe emissions, but more efficient all around. 

“Technology is very important for achieving high utilization, which then makes electric transport very competitive,” says Robert. To learn more about the critical role of digital infrastructure, read our deep dive into why you can’t go electric without going digital

Truck driver interacting with Einride Saga

Einride is driving the shift today

Einride operates some of the largest fleets of electric vehicles in Europe and North America. Here are just a few client cases to highlight:

  • With the largest electrification of road freight in the FMCG industry, Mars will cut roughly 10% of its road transport GHG emissions in Europe by 2030.

  • A fleet of intelligently operated Einride electric trucks is shipping supplies to over 300 REWE supermarkets in Berlin and Brandenburg.

  • Following a historic US pilot in 2022, GE Appliances is now live in day-to-day autonomous freight operations at Selmer, TN.

  • By deploying 300 electric trucks as well as supporting infrastructure in the US, Einride will electrify over 1 million shipments in 5 years for Maersk.

Additionally, in 2024, Einride launched North America’s largest charging facility for heavy-duty vehicles – the Einride Smartcharger Station at Lynwood, CA. With stations powering up at more locations around the world, Einride is at the forefront of driving the transition to intelligent and sustainable road freight.

With Einride as your transformation partner, you can deploy electric freight operations without complexity or costly upfront investments. Join a growing list of businesses leveraging Einride’s intelligent ecosystem to decarbonize their freight operations at scale and achieve greater business resilience. The consensus is clear: the time to make the switch is now.

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Ready to turn your electric ambitions into electric routes? Get familiar with the process in our 6 steps to intelligent, sustainable road freight. To be informed of forthcoming webinars, be sure to subscribe to our newsletter

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