From protection to exposure: commercial demonstrations as steppingstones for large-scale diffusion of electrified heavy vehicles

Keywords:

Abstract:

Trends of urbanisation and changed consumer behaviours such as internet-shopping result in increased urban goods flows (Cardenas et al., 2017; Russo and Comi, 2012) and with mounting pressure to reduce congestion and road transport emissions, policy makers need to prepare for major transformations in urban transportation. Due to their low noise, zero exhaust emissions and high energy efficiency in city traffic, electric trucks can enable such transformations. These vehicles generate radically new possibilities, such as a partial shift of urban goods distribution to the night-time. 

The diffusion of electric trucks challenges current structures and practices in the heavy vehicle industry. Established vehicle manufacturers face increasing pressure to interact with grid operators and charging equipment manufacturers to integrate their products with the electric grid. In turn, to implement systems for vehicle charging, grid operators and charging equipment manufacturers need to interact with city planners and local authorities. Further, to facilitate vehicle charging and night-time delivery, haulers, logistics companies and transport buyers have to reconsider schedules and practices. Since electric trucks are associated with higher purchase cost, investment decisions will differ, and limitations of on-board battery capacity will put restrictions on logistics planning, necessitating stakeholders to transform their business models. 

In the heavy vehicle industry, there are traditionally significant technological synergies between trucks and buses. Such synergies are possible also in the case of electric vehicles. On the bus market, the implementation of electric vehicles has initiated a ground-breaking transformation. However, as the city bus segment is characterised by direct policy intervention, the user contexts and buying practices differ substantially. With public transport authorities stipulating electric propulsion, the city bus segment has functioned as a protected niche, which has nurtured experiential learning. Thus, it is possible for vehicle manufacturers to benefit from the lessons learned from electric bus operation in their development and supply of electric trucks. Still, diffusion in the truck segment is more complex, with a more fragmented user context and limited possibilities to obtain protection from public procurement. That calls for a demand-based perspective which considers the user context as an essential determinant of technology evolution (Adner and Levinthal, 2001). 

With limited direct protection, market introduction of electric trucks implies greater pressure from the selection environment. Connecting basic knowledge generation and technological breakthrough with processes of commercial adoption (Hellsmark et al., 2016), demonstrations can facilitate controlled exposure to such pressures. Through participation in demonstration projects, stakeholders can raise questions on how to embed the new technology into wider ethical, legal, societal and business contexts (Boon et al., 2008; Schot et al., 2016; te Kulve and Konrad, 2017). Demonstration projects thus refer to actively constructed processes of demand articulation, where stakeholders interact to adapt and shape product requirements, user needs and demands. Being instrumental for the diffusion of new technologies, controlled exposure has received attention in literature on strategic niche management, and more recently in contributions on niche empowerment (Kern et al., 2015; Mylan et al., 2019; Smith and Raven, 2012). This paper contributes to this literature by distinguishing pre-commercial demonstrations from post-commercial demonstrations. Whereas the former facilitates entry to a protected market segment, the latter makes it possible for new technologies to enter larger market segments that operate with limited protection. A prerequisite for such entry is that the demand articulation processes can initiate changes of the selection environment (cf. Schot and Geels, 2008; Sushandoyo and Magnusson, 2014). The paper addresses the following research question: 

How can actively constructed processes of demand articulation in commercial demonstration projects initiate changes in the selection environment? ​ 

The paper builds on a multiple case study of demonstration projects featuring electrified urban distribution trucks. Based on 26 semi-structured interviews with key stakeholders, it provides a comparative analysis of projects in Gothenburg, Hamburg and Stockholm. The case analysis shows how commercial demonstration projects place emphasis on societal and business aspects. The involved stakeholders showed great concern for implications on future business models, and valuations of wider societal and environmental benefits. This includes reduced emissions and noise levels, transport and energy efficiency, and improved work environments for professional drivers. Commercial demonstrations can gather stakeholders in specific user contexts to articulate demands on technical and institutional change. For example, the studied projects resulted in valuable inputs regarding both regulatory changes (e.g. night-time access into the city centres for silent distribution trucks) and implications for charging infrastructure, showing how an actively coordinated and subsidized build-up of charging infrastructure can facilitate interactive learning processes. Demand articulation in post-commercial demonstration projects thus creates pressure for external changes, pointing at the need for a “stretch and transform” empowerment (cf. Smith and Raven, 2012). This shows how controlled exposure can foster a better understanding of the linkages between the specific selection environments and the broader transformations required to facilitate an upscaled diffusion of electric heavy vehicles. 

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