Decarbonisation of Transportation: IAA Transportation 2024

Decarbonisation of Transportation – Front and Centre:

On September 17, 2024, the highly anticipated IAA Transportation event took place once again in Hannover, Germany. As one of the world’s leading trade fairs for the commercial vehicle industry, it attracts manufacturers, suppliers, logistics experts, and policymakers from all over the globe. Held every two years, this prestigious event showcases the latest innovations and trends in transportation. This year, James Fox, Hickman Shearer Director and transportation sector specialist, attended the event and shared his valuable insights.

This marked James’ third visit to the IAA since 2018. The transportation world descends on Hannover, and it seems that everyone who is anyone in the sector is there; from the major OEMs showcasing their latest low and zero emission vehicles, to political heavyweights and policymakers from the European Union and the German Federal Government. The IAA provides a unique platform where discussions on the future of the industry take place. With transportation experts and decision-makers gathered under one roof, the event offers a global perspective rarely seen at regional gatherings. Here are some of the standout trends and insights from James’ time at IAA 2024.

The Future of Internal Combustion Engines (ICE)

Despite the push for electrification, internal combustion engines (ICE) are still seen as a significant part of the transportation landscape. Volvo Group’s Chief Technology Officer, Lars Stenqvist, made a bold statement during the event: “Internal Combustion Engines belong to the future.” He emphasized that Volvo had never invested as much in ICE engines as they did in 2024. Volvo sees gas-powered vehicles as a bridge to a zero-emission future. This approach is seen as practical given the commonality between diesel, gas, and hydrogen-powered engines. While the ultimate goal is full decarbonisation, Volvo believes that ICE vehicles will remain relevant, especially as the industry seeks viable pathways to zero emissions.

The Rise of AI and Machine Learning

Artificial Intelligence (AI) and machine learning (ML) are rapidly transforming the commercial vehicle industry. Iveco showcased how these technologies are being integrated to enhance sustainability, fuel efficiency, logistics planning, driver comfort, safety, and vehicle uptime. As digitalisation becomes increasingly essential, AI and ML offer natural solutions to improve vehicle performance. These advancements aim to create safer and more efficient operations, enhancing the overall working environment for drivers and reducing operational costs for companies.

Biofuels as a Decarbonisation Solution

Biofuels are an attractive answer to the question of the decarbonisation of existing diesel vehicles. ICE vehicles displayed on manufacturer stands were advertised as being compatible with alternative fuels such as HVO, without any adjustments to the vehicle driveline. DAF claimed that HVO offers a reduction of up to 90% CO2 emissions vs. regular diesel. This is seen as an attractive option for decarbonising fleets that still rely on diesel-powered vehicles, especially for those not ready to transition to fully electric options.

The Infrastructure Challenge

While the innovations on display were impressive, a significant issue that dominated the discussions at IAA 2024 was infrastructure, or rather, the lack of it. During the “Sustainable Transport and Logistics of the Future” session, one panelist remarked, “Politicians are watching us fail,” highlighting the perceived lack of government support. Many attendees echoed this sentiment, pointing to the lack of sufficient power networks and the complexities around planning permissions as major roadblocks. Without improved infrastructure, the adoption of zero-emission vehicles will continue to be slow, no matter how advanced the technology becomes.

Conclusion

Decarbonising the heavy vehicle sector is an immensely complex challenge, and the path forward is far from straightforward. The industry must navigate the integration of new technologies, deal with infrastructure bottlenecks, and address concerns from lenders who are cautious about backing the wrong technology. It is critical to make informed decisions when investing in the future of transportation. We at Hickman Shearer are committed to sharing our insights and helping companies develop forward-thinking policies.

For those looking to navigate this evolving landscape, reaching out to experts like James is essential to making the right investment choices for the future. Get in touch with James today >> Contact James Fox

Hickman Shearer are a leading independent capital asset valuation, management and used equipment sales company based in the United Kingdom providing expertise and professional advice in relation to capital assets and the built environment. Want to know more? >> About Hickman Shearer.