The electric heavy-duty truck helps reduce exposure to oil price fluctuations

The consequences of the war in Iran and the blockade of the Strait of Hormuz are rapidly affecting diesel and gasoline prices at the pump due to the sharp rise in the price of a barrel of oil, leading to higher road transportation costs.

Today, there has been an increase of about 15% in the price at the pump (1.6 €/L vs. 1.4 €/L) for B7 diesel, according to figures compiled by the government[1]. Rising prices for fossil fuels such as LNG (liquefied natural gas) will also affect electricity prices, since electricity in Europe is generated in part using gas, and France relies on the European grid.

However, For a diesel heavy-duty truck, fuel accounts for ~60% of the TCO (Total Cost of Ownership), whereas for an electric heavy-duty truck, electricity accounts for ~40% of TCO, or even less if all recharging takes place at the depot. This leads to lower price volatility for electric vehicles, which could be a game-changer.

The differences in total cost of ownership (TCO) between a 44-metric-ton diesel tractor-trailer (B7) and an electric tractor-trailer vary greatly depending on the situation, but let’s take, for example, an additional cost of 10% of the electric TCO prior to the start of the war. Today, the gap between the two fuel types has narrowed to 6%, assuming an equivalent increase (+15%) in the prices of diesel and electricity. Assuming that electricity prices remain stable (for example, in the case of self-consumption or PPAs), The TCO can even reach parity.

Comparison of Total Cost of Ownership (TCO) for a 44-metric-ton tractor-trailer[2] (centimes/tkm)

Admittedly, indexing to the price of diesel allows carriers to pass on changes in diesel prices to shippers (those who contract for freight transport). But for shippers, this once again highlights the suitability of electric vehicles for road transportation and the need to accelerate this transition in order to better plan transportation budgets and control costs. And in the medium term, this helps increase the resilience and sovereignty of France’s transportation networks by reducing dependence on geopolitical conflicts.

There is a general consensus that, in most cases, the total cost of ownership (TCO) for diesel and electric vehicles will be on par by 2030. With geopolitical uncertainties growing, this may happen sooner than expected, which will give a competitive advantage to those who have been able to anticipate this.