Light commercial vehicles (LCVs) used for the transportation of goods are following the trends of the wider automotive market in their rising electrification. IDTechEx’s latest report, “Electric Light Commercial Vehicles 2025-2045: Markets, Players, Forecasts“, brings attention to regulations, sales, and OEMs within the sector and compares diesel, battery, and fuel-cell options.
City driving and battery possibilities
Being mostly used within cities for short to medium distances daily, LCVs complete less driving distances than other delivery vehicles. Their smaller weight and volume capacity than that of trucks means that they are easier to electrify, as they require smaller batteries and motors and have more access to charging points in the built-up areas they operate in. IDTechEx reports that battery size for LCVs has trended upwards in the last few years, with the average being 50kWh and sometimes reaching to 150kWh, which is sufficient for two or more days of work on a single charge.
Drivers for electrifying LCVs
Increasing e-commerce and a fast-growing population means that the demand for LCVs is expected to surge between 2020 and 2050, as demonstrated by the recent number of sales. In 2023, the LCV market reached over 8.6 million unit sales, with China holding 31% of this market, with the US and Europe representing 19% and 17% respectively. Alongside consumerism motivations for LCVs, increasing regulations for reducing emissions will also make the electrification of LCVs more popular, as these vehicles are usually regulated similarly for passenger vehicles. Legislations, including fossil fuel bans, purchase grants and incentives, and local emission restrictions, will all act as drivers.
Global regulations and legislation for LCVs
By 2035, the EU plans to impose a ban on all cars and vans that produce emissions, with the UK potentially bringing this date forward to 2030, and while purchase grants and incentives differ amongst European countries, IDTechEx states they are most commonly between €3,000 and €10,000. There are nearly 30 low or emission-free zones across 18 European countries, meaning there is lots of incentive for electrification. In some cities, such as London, there is a charge for driving through emission-free zones, meaning eLCVs may become increasingly necessary.
China maintains smaller purchase grants and much less regulation than in Europe surrounding vehicle emission reductions, with the first emission-restricted zone put in place in 2022. Despite a potential ban on combustion engine LCVs expected around 2040, hybrids and plug-in hybrids are likely to still be allowed for longer after this date. However, somewhat ironically, there is a denser population of OEMs producing eLCVs in China, meaning there is no shortage of access to the vehicles.
California is also known to have its own policies outside of the rest of the US, with a petrol car and truck sale ban being introduced from 2035 and all trucks aiming to be zero-emission by 2045.
Market share and alternatives to BEVs
The sales share of eLCVs stood at a global average of 5% of all EV sales in 2023, with 28% of all EV sales in Korea being eLCVs. Europe had 7% eLCV sales, with new eLCV registrations rising consistently between 2019 and 2023. IDTechEx predicts greater growth will begin again in 2025 and continue after a dip in 2024.
Despite lower upfront costs than BEVs, plug-in hybrids won’t be a long-term solution because of their emissions, while fuel-cell electric vehicles are likely too costly. The lack of hydrogen infrastructure and availability of green hydrogen also makes fuel-cell vehicles a less favorable option. BEVs are expected to remain the dominant focus, as the technology is the most mature, and is best suited to future requirements and regulations.
Market outlooks and report coverage
IDTechEx predicts that over 11 million eLCVs will be sold annually by 2045 with a 20-year CAGR of 15.6%. With almost all LCV manufacturers now producing electric options, there are over 100 unique eLCV models, including models from Renault, Ford, and Nissan. An extensive list of OEMs is included within the report, alongside details on sales, battery demand, fuel cell demand, and revenue and market size by powertrain and region.
