The impact of alternative fuel vehicles—which include not only EVs (electric vehicles), but also vehicles that run on biodiesel, hydrogen, natural gas, and other alternative fuels—on the future transportation infrastructure will be significant. For instance, MarketsandMarkets projects by 2030, almost 27 million EV units will sell, compared to just over 3 million EV units in 2019. And even though the global EV market had begun to flatten in the past year due to changing government incentives and phased-out subsidies in the U.S., and then it took a deep plunge earlier this year as a result of the COVID-19 pandemic, the overall trend toward more sustainable transportation modes and alternative fuels is expected to win out in the long run, eventually giving way to fully autonomous vehicles.

In May, at the 2020 Financial Times global digital conference, Volvo CEO Håkan Samuelsson predicted the pace of change in the automotive industry will actually accelerate thanks to the pandemic, and one major contributor to this change in pace will be a faster shift to “electrification.” The economic climate produced by the pandemic will encourage people, when they’re ready to start buying again, to look for the most economic solutions to their transportation needs, Samuelsson suggests, and this could lead to a higher uptake of EVs and a new openness to emerging business models like car sharing versus private car ownership.

EVs aren’t the only group of alternative-fuel vehicles that will impact the transportation space in the coming years. In June, Valuates Reports valued the hydrogen fuel cell market (spanning transportation, stationary, and portable applications) at $1.78 billion in 2019, and projects it will reach $5.5 billion by 2026. Automotive companies like BMW, Daimler, Honda, Hyundai, and Toyota are all developing FCEV (fuel cell electric vehicles) with a hydrogen fuel cell, according to the report. The FCHEA (Fuel Cell & Hydrogen Energy Assn.) describes fuel cells as devices that combine hydrogen and oxygen to generate electricity through an electrochemical reaction. Fuel cell vehicles produce zero emissions except water vapor.

Buses, as well as medium-duty and heavy-duty trucks will also utilize fuel cell technology. Hyundai, for instance, recently announced it’s shipping the first 10 units of its fuel cell heavy-duty truck, the XCIENT Fuel Cell, to Switzerland. The automaker plans to roll out 50 XCIENT Fuel Cells this year, with a total of 1,600 of the trucks by 2025. Hyundai says the XCIENT Fuel Cell can travel nearly 250 miles on a single charge.

Alternative-fuel vehicles require infrastructure in the form of places to recharge/refuel. Some companies are both investing in vehicles/fleets as well as the infrastructure to support these vehicles and fleets. UPS, for instance, says by this year, one in every four of the ground vehicles it purchases will be an alternative fuel vehicle, and by 2025, 40% of the fuel it uses in ground vehicles will leverage alternative fuels like electricity and hydrogen. From 2008 to 2018, UPS invested more than $1 billion in alternative fuel and advanced technology vehicles, as well as infrastructure in the form of fueling stations. The company is also pursuing sustainable delivery methods like e-bikes in dozens of global markets.

Logistics companies, fleet owners/operators, automakers, and governments are all thinking about how alternative-fuel vehicles will impact the future of transportation and the infrastructure required to support these vehicles. Smart vehicle technology will also play a role in bringing this next generation of transportation to the forefront, helping vehicle and fleet owners/operators better manage their fuel usage, find charging/refueling stations, and stay safe on the road.

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