Blog: By Dominic Scholfield, Mobility and Strategy Team Leader, Cenex

Last year, I wrote a blog about battery swapping as a possible solution for increasing the effective operating range of electric heavy trucks. This was prompted by the announcement of a joint venture between Mitsubishi Fuso and Ample in Japan to trial the technology for last mile delivery vehicles, and by developments in China. I knew the big European truck manufacturers were not fans of the approach, but it seemed at the time like maybe they would have to reconsider.

At this year’s Cenex Expo, I raised the subject again with representatives of a few big truck OEMs, just to see if they’d changed their minds. Not a bit of it. “Not a chance” they said, and, “the Chinese are actually moving away from it, they see it as a bit of a stop gap and now that battery electric trucks are improving it’s losing favour”.

Then a few weeks ago Wincanton announced a joint project with Tual, a portable battery solutions company, to trial their swappable batteries to extend the range of their electric trucks. The Tual battery is akin to an external power bank you might use for your phone, but much bigger, and was originally aimed at van drivers who take their van home at night but don’t have a charger. Backed by the UK Freight Innovation Fund, this latest project is part of Tual’s journey to find the ideal use case for its product, but it’s a long way from a full battery swap solution.

So, I decided to take another look and see how battery swapping was doing elsewhere, and you know what, reports of its death are greatly exaggerated. A major study by the Swedish technical institute VTI had obviously not made it onto the OEMs’ reading list[1]. In the first half of 2024, sales of battery swap trucks in China were 2,497 units, up 87% on the same period in 2023, and battery swap trucks now outsell conventional battery electric trucks in what is the largest electric truck market in the world by some margin. In that same period, the Chinese government announced four different policies supporting battery swapping at a national level, and a further seven at a sub-national level[2].

Far from this being a poorly developed stop-gap technology, both battery swap trucks, and battery swapping stations, are now in their third generations. The location of batteries is now moving from behind the cab (easy to implement but leading to poor handling and aerodynamics) to loading at the side or dropping out of the bottom of the chassis. There are now 38 different Chinese OEMs working on battery swap trucks, many of them designing for electric drivetrains from the bottom up, favouring aerodynamic vehicles that are ready for all options, megawatt charging, battery swap, fuel cell and fully autonomous operation.

The development of the technology is seeing a move from more localised operations to long distance trucking corridors. This requires consolidation in the market and greater standardisation, and battery manufacturer CATL (which has over 90% market share for swappable batteries) is emerging as the key player in this.

The question now is, will this remain a Chinese phenomenon, or will we see battery swapping emerge in other markets? The joint venture between Mitsubishi Fuso and Ample in Japan is continuing, and Ample is taking that learning back to its core US market. And there are early market solutions emerging in both Australia and New Zealand.

In the EU, the scepticism of the OEMS is still standing in the way, but there is reason to believe that one of them at least might break ranks. In Germany, the government is funding a project to develop a battery swapping station. The consortium carrying out the work includes Bosch and technical institutes, but not an OEM – however, back in China Daimler (i.e. Mercedes) are partnering with a company that has over 800 battery swap stations, to develop trucks with a third generation ‘drop out’ battery. Plus, they are also part of the Mitsubishi Fuso project in Japan. If they have first-hand knowledge of how it works in their own trucks in the far East, could it be that they are eying the opportunity to bring the idea to Europe?

For now, European OEMs seem to be firmly backing megawatt charging (MCS). However, in other markets it has been the energy system operators that have really championed battery swapping, and they may do the same in Europe. A motorway services with half a dozen megawatt HGV chargers could require as much power as a small town, putting huge strain on the grid. By contrast, the same site hosting a battery swapping station filled with high-capacity batteries would be hugely beneficial to the local grid and have a nice second revenue stream providing grid balancing services.

Battery swapping is a technology that offers a host of benefits for everyone, except perhaps the truck OEMs. It’s great for the energy system, allowing battery manufacturers to sell more products and get their latest technology straight into existing vehicles, and truck operators want it because they get quick refuelling and separate the cost of the battery from the truck. The OEMs see it as a threat to their current business model (maybe correctly), but if they refuse to embrace it there are a lot of new companies in China ready to eat their lunch.

To learn more about our fleet electrification projects please visit: Cenex Resources | Reports, Prospectus, Analysis & Studies

 

[1] Report is advocating pilot tests of battery swapping for heavy vehicles – vti.se

[2] Zero-emission medium- and heavy-duty vehicle market in China (January–June 2024) – International Council on Clean Transportation