Sales of electric buses, comprising all medium- and large-sized buses, are far ahead of those of other heavy-duty vehicle (HDV) segments (including medium- and heavy-duty trucks1). Several European countries (such as Belgium, Norway and Switzerland) and the People’s Republic of China (hereafter "China") achieved sales shares above 50% in 2023, and more than one-fifth of bus sales were electric in Canada, Chile, Finland, the Netherlands, Poland, Portugal and Sweden. Globally, almost 50 000 electric buses were sold in 2023, equating to 3% of total bus sales and bringing the global stock to approximately 635 000 in total. This relatively low share is primarily due to the limited sales shares in most EMDEs, as well as the low market penetration of electric buses in some larger markets such as the United States and Korea.

Early policy support for electrifying public transport, and the availability of domestically produced electric buses, coupled with incentives, meant that China took an early and significant lead in electric bus sales. In 2020, China was responsible for about 90% of electric bus sales worldwide. In 2023, this fell to around 60%, largely due to a decrease in domestic demand for both electric and ICE buses and, to a lesser extent, increasing sales in other regions. The fall in Chinese demand could be a consequence of the early success seen for electric buses – around 65% of China’s electric bus stock was deployed before 2019. It may also be linked to the ending of purchase subsidies for BEV and PHEV buses at the end of 2022. Despite China’s lead in global sales having shrunk, Chinese manufacturers continue to export large volumes of electric buses, accounting for over 85% of electric city bus deployments in Latin America. They have also increased their market share in the European Union from 10% of bus sales in 2017 to 30% in 2023, driven by companies such as Yutong and BYD.

City buses, in particular, have strong potential for electrification thanks to their relatively fixed driving patterns and lower daily travel distances, and have spearheaded growth in electric bus sales. In the European Union, BEVs reached a 43% sales share among city buses in 2023, demonstrating clear progress towards the proposed target of 100% of city bus sales being zero emissions vehicles (ZEVs) by 2035. Over the same period, just 1% of European Union coach sales were battery electric, though uptake is increasing there and around the world.

There has also been encouraging progress in EMDEs, where a focus on the co-benefits of electric buses – such as reduced air pollution and greater access to public transport – has boosted take-up. This has been further supported by the wide availability of electric buses in already competitive markets. Cities across Latin America, such as Bogota and Santiago, have deployed nearly 6 500 electric buses to date. BasiGo, Africa’s largest electric bus company, has an order book of 350 buses, which represents almost 2% of electric bus sales outside of China in 2023, and aims to sell a further 1 000 electric buses in Kenya and 200 in Rwanda in the coming years.

Along with high potential for electrification of city buses, infrastructure developments can also support the transition. The bus rapid transit (BRT) system, which is based on the use of dedicated bus lanes with priority access at intersections and off-board fare collection, can support the establishment of high-capacity, efficient services for cities. The new all-electric BRT system in Dakar – the first on the African continent – is a strong example. This network, announced at the end of 2023, will serve 320 000 passengers per day. Elsewhere, the European bus rapid transit of 2030 (eBRT2030) scheme aims to improve the urban transport environment by developing innovative solutions for electric BRTs, with demonstrations in Amsterdam, Athens, Barcelona and Prague, among other cities.

Sales of electric trucks increased 35% in 2023 compared to 2022, meaning that total sales of electric trucks surpassed electric buses for the first time, at around 54 000. China is the leading market for electric trucks, accounting for 70% of global sales in 2023, down from 85% in 2022. In Europe, electric truck sales increased almost threefold in 2023 to reach more than 10 000 (>1.5% sales share). The United States also saw a threefold increase, though electric truck sales reached just 1 200, less than 0.1% of total truck sales.

We expect electric truck sales to continue to increase thanks to strong and ambitious policies, such as the European Union’s CO₂ standards for HDVs, which target a 90% CO₂ emissions reduction by 2040. In the United States, the newly adopted heavy-duty emissions regulation is expected to result in ZEV sales shares of up to 60% by 2032 in different segments.

At the city-level, zero emissions (or “green”) zones for freight, are being implemented in 15 different cities as diverse as London, Los Angeles, Madrid, Quito, Shenzhen, Seoul and Taoyuan City. Together, these cities have a total population of over 52 million. In addition, initiatives such as EV100+, the Global Memorandum of Understanding on Zero-Emission Medium and Heavy Duty Vehicles co-led by Drive to Zero, the European Clean Trucking Alliance, the eTransport coalition, the First Movers Coalition–Trucking, and the Fleet Electrification Coalition have increased their membership. They continue to advocate for more ambitious policies, such as accelerated sales targets and zero emission government fleets.

In the United States, there have been efforts to use demonstration projects to identify truck segments ripe for electrification. In June 2023, the North American Council for Freight Efficiency, together with the Rocky Mountain Institute, launched Run on Less – Electric DEPOT. Through this initiative, depots deployed almost 300 electric trucks of various sizes to gather telemetry data with the aim of identifying use cases where electric trucks are already a viable solution, as well as where challenges remain.

Similarly, the UK Government is investing USD 250 million under the Zero Emission HGV and Infrastructure Programme to run real-world trials of zero-emission trucks. The programme will deploy 370 trucks and almost 60 refuelling and electric charging sites.

Electric truck adoption is also gaining momentum in EMDEs outside of China. In India, NITI Aayog launched the Electric Freight Accelerator for Sustainable Transport, a platform to pioneer collaboration between the government and private sector partners for large-scale freight electrification. This initiative has spurred 16 major manufacturing and logistics companies to collectively signal demand for 7 750 electric freight vehicles by 2030. To meet this demand, focused efforts will be needed on policy regulation, establishing market certainty, scalable pilot support, infrastructure development, and creating blended financing platforms to attract private investments.

Chinese OEMs currently produce by far the largest number of models of battery electric HDVs – 430 in total – with a particular focus on buses suitable for urban public transport, which make up almost 40% of all models.2 In 2021 alone, Chinese OEMs released almost 150 bus models, providing more choice and covering more applications in what was already the world’s largest electric bus market. Since 2021, the number of additional new models has continued to grow, but with a more even distribution across different segments – over 65 new models for buses, and around 40 each for medium-duty and heavy-duty trucks – thereby enabling wider electrification. A significant number of models is now available in each segment in China.

North American OEMs produce a far smaller number of battery electric models – over 170 – with a greater emphasis on the medium-duty truck market, which accounts for more than 60% of all models. New brands such as Rizon are targeting the electric medium-duty segment in North America, where despite their higher upfront costs, electric trucks are already competitive with diesel trucks in terms of total cost of ownershiplifetime costs, especially when charged at depot as opposed to higher-cost public charging. Costs are even more competitive when factoring in incentives available in the United States and Canada. Though both the United States and Canada also have policy incentives specifically targeting buses, they have relatively small public transport markets and, as a consequence, buses suitable for urban public transport make up just over 10% of all models. Instead, OEMs have targeted the school bus niche, producing nine different models excluding minibuses.

Despite producing a lower number of battery electric models overall, at around 120, European OEMs offer the most even distribution of models across segments. They also have the highest share of heavy-duty trucks, with more than 20% of all models. This has allowed European OEMs, in particular the Volvo group (which includes the Mack, Renault, and Dongfeng (joint venture) truck brands), to gain a large share of not only the European, but also the North American heavy-duty electric truck market. European OEMs also produce a significant number of niche vehicles such as refuse trucks (around 10% of all models), which – like medium-duty trucks – are already cost-competitive with their ICE counterparts.

On average, individual Chinese OEMs produce more models across segments, which differentiates Chinese OEMs from those in other regions. Only about half of Chinese OEMs produce models for a single segment, compared to around 70% in North America and Europe.

Model availability is a key indicator of the growing maturity of the battery electric HDV market, but the number of OEMs is also important for assessing competition and ability to meet future demand.

The number of OEMs producing electric HDVs in China trebled between 2020 and 2023, from 12 to 36, in response to increasing sales of electric trucks domestically, as well as increasing electric bus sales abroad. In addition to growth in the number of Chinese OEMs, companies such as BYD, Skywell, Dongfeng and Foton have also expanded their offerings, with models in the bus, MD truck, and HD truck segments, offering potential advantages in terms of economies of scale and supply chains. The strength of the domestic market may also have allowed Chinese firms to build more robust supply chains.

North America also experienced an almost threefold increase in the number of HDV OEMs between 2020 and 2023, from 16 to 45. Early support in states such as California and anticipation of national policies supported investment in HDV manufacturing, which was later boosted by demand incentives and regulations. United States-based OEMs typically specialise in models for a smaller number of segments than Chinese OEMs. Only Lion offers vehicles in the bus, MD truck, and HD truck categories, along with Exro’s recently acquired SEA Electric, which builds vehicles for different applications by adapting its powertrain to glider chassis platforms from other OEMs.

Europe had the highest number of HDV OEMs in 2020, but still saw a 50% increase between 2020 and 2023 to reach 36, the same number as China but less than the United States. Established OEMs such as Volvo Trucks, MAN, Mercedes, and Quantron offer vehicles in three or more segments. This wide range of offerings, coupled with an already strong position in the global market, and relatively low sales shares in Europe prior to 2023, meant there was less space for new entrants to compete.

Manufacturers in the rest of the world have not responded to the electric HDV opportunity in the same way, mirroring the slower uptake of electric HDVs to date and fewer supportive policies than in leading electric HDV markets. Of the OEMs outside of China, North America and Europe, nine produce models in the bus segment alone, with India’s Tata Motors producing both buses and MD trucks. Korean OEM Hyundai produces only FCEV HDVs, while only three Japanese OEMs feature in the database.