Electric Truck Market Size & Outlook, 2025-2033

Electric Truck Market Overview

The global electric truck market size was valued at USD 1.34 billion in 2024 and is projected to grow from USD 1.69 billion in 2025 to reach USD 10.73 billion by 2033, growing at a CAGR of 26% during the forecast period (2025–2033). Government incentives for e-mobility and strict emission norms for fossil-fuel vehicles are driving the growing demand for electric trucks.

Key Market Indicators

• Asia Pacific dominated the electric truck industry and accounted for a 57% share in 2024.
• Based on application, the last-mile delivery segment held the largest share of approximately 24.2% of the electric truck market in 2024, owing to rapid e-commerce growth, supportive government policies, and cost-effective, route-defined operations ideal for electric vehicles.
• Based on propulsion, the BEV segment is witnessing significant growth, driven by their superior efficiency, lower operating costs, simpler maintenance, and strong adoption in short and mid-range duty cycles.
• Based on type, the light and medium-duty trucks segment dominated the electric truck industry in 2024 due to their suitability for battery electric powertrains, TCO parity in urban use, and high adoption by e-commerce, logistics, and municipal fleets.

Market Size & Forecast

• 2024 Market Size: USD 1.34 billion
• 2033 Projected Market Size: USD 10.73 billion
• CAGR (2025–2033): 26%
• Asia-Pacific: Largest market in 2024
• Europe: Fastest-growing region

Electric trucks are characterized as commercial vehicles used for cargo transportation that is powered by a battery pack. Additionally, compared to diesel trucks, electric vehicles' internal motors have fewer moving parts and don't require multi-speed gearboxes, which lowers maintenance costs and improves reliability while producing nearly no noise. Furthermore, due to government initiatives to encourage the use of electric vehicles and their amazing benefits like massive amounts of torque, zero noise pollution, minimal maintenance costs, and others, electric trucks are increasingly becoming the preferred option over diesel trucks. The market for is expanding due to growing government initiatives to promote e-mobility and strict emission standards for fossil fuel-powered vehicles.

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Electric Truck Market Growth Factors

Growing Government Programs to Promote E-Mobility

To reduce carbon emissions caused by burning diesel fuel and battle greenhouse gas emissions, governments worldwide are putting pressure on automakers to invest in the development of electric trucks. Governments are offering incentives through programs and plan to encourage the production of battery electric trucks, which is expected to fuel the market's expansion. Governments worldwide are also providing tax breaks and other incentives to promote the purchase of electric vehicles. Additionally, the central governments of a select few nations exempt electric vehicles from paying the highway toll levy.

• For instance, the Indian government intends to reduce the Goods & Service Tax (GST) on e-vehicles from 12% to 5% to hasten the adoption of electric vehicles.

Additionally, tax exemptions of about $2,101.5 will be provided on loans made to buy an e-mobility. The South Korean government has also said it will offer tax breaks and subsidies totaling $900 million to create and purchase electric and fuel cell vehicles. Thus, one of the key factors driving the demand for electric trucks is a growth in government support for creating and purchasing electric mobility through tax credits, subsidies, and incentives.

Stringent Emission Norms Imposed on Fossil-Fuel Powered Vehicles

In response to rising environmental concerns, governments and environmental organizations worldwide are implementing stringent emission limits and legislation to reduce automobile emissions. Major regulatory initiatives include strict emission objectives for lowering nitrogen oxide (NOx) levels and atmospheric carbon dioxide (CO2). The federal and state governments in the United States are intensifying efforts to make transportation cleaner due to the enormous amounts of greenhouse gases emitted from cars.

• For instance, the U.S. Environmental Protection Agency (EPA) declared that it was developing new regulations to reduce nitrogen oxide (NOx) and other pollution emissions from heavy-duty trucks. Additionally, the heavy-duty Low NOx Omnibus Regulation, which the California Air Resources Board (CARB) is implementing, seeks to achieve a 90% decrease from current NOx emission limits by 2027. In addition, the European Union (EU) pledged to meet its 2020 greenhouse gas reduction goal of 20% under the Kyoto Protocol as part of the Paris Agreement (COP21). The EU has also set the goal of reaching net-zero emissions by 2050 and a 40% decrease in greenhouse gas emissions by 2040.

Therefore, the burden on vehicle manufacturers, particularly those of commercial vehicles, has increased with the implementation of emission restrictions for fossil fuel-powered vehicles. The demand for market is then anticipated to grow as a result.

Market Restraint

Lack of Charging Infrastructure

The adoption of electric vehicles for business usage is encouraged by governments from several nations to minimize greenhouse gas emissions. Nevertheless, a lack of charging infrastructure hinders for market. For instance, the Indian government wants to have only electric vehicles on the road by 2030. But one of the essential conditions for ensuring the adoption of electric vehicles is the development of a robust electric vehicle infrastructure. Unfortunately, India's EV charging infrastructure is now insufficient and is still lagging what is needed, impeding the expansion of the electric truck sector. In addition, despite being one of the largest markets for electric vehicles, China is having difficulty supporting an adequate infrastructure for recharging electric fleets. This is expected to have a negative impact on the market. As a result, the demand for market isn't expanding because of a lack of charging infrastructure.

Market Opportunity

Rising Demand for Electric Trucks from the Logistics Sector

As the demand for environmentally friendly transportation rises globally, especially in the freight transportation sector, which is a significant contributor to carbon dioxide emissions, there is a reduction in the emissions of dangerous gases from automobiles. The market is also expected to grow due to government programs encouraging the adoption of electric trucks and replacing commercial diesel vehicles with electric vehicles. Due to the growing need for logistics services brought on by the e-commerce, retail, and industrial industries, supply chains, and logistics companies are actively replacing their fleet of vehicles with greener vehicles. For instance, logistics organizations in the UK have begun planning to increase the number of commercial electric vehicles in their fleet over the next few years. The development of a cutting-edge pilot fleet of 35 commercial electric delivery trucks to be tested in London and Paris was announced in 2016 by United Parcel Service (UPS), an international American package delivery and supply chain management corporation. Additionally, in March 2019, Yamato Transport Co., Ltd. (Yamato Transport) disclosed that it had collaborated with StreetScooter GmbH (Aachen, Germany), a Post DHL Group firm, to develop a small commercial electric truck for house delivery. Yamato Transport intends to introduce 500 electric trucks in 2019 and utilize them in Tokyo, Saitama, Chiba, and Kanagawa starting in the fall.

Regional Analysis

Asia-Pacific was the highest contributor and is anticipated to grow at a CAGR of 22.2%. Increased vehicle production from China and increased investment in the Indian automobile industry are driving the growth of the market in this region. Rising investment in battery technology development programs and environmental pollution concerns will drive the market. In addition, the rising demand for freight transportation from emerging markets such as India, Thailand, and Indonesia will significantly influence this region's market growth.

Europe Market Trends

Europe is the second largest region. It is estimated to reach an expected USD 180 million by 2030, registering a CAGR of 29.9% during the forecast period. Europe includes the UK, Germany, France, Russia, and the Rest of Europe. The rest of Europe includes Sweden, Norway, Italy, the Netherlands, and others. With the growing environmental concerns, European governments and environmental agencies are enacting stringent emission norms and laws that increases the demand for commercial electric vehicle in Europe.

• For instance, the European Union (EU) is committed to achieving its 20% greenhouse gas reduction target in 2020 for the second phase of the Kyoto Protocol. The EU wants to reach its goal of zero greenhouse gas emissions by 2050. Based on the NEDC (New European Driving Cycle) test technique, the regulation EU 253/2014 establishes the objective of 147 mg of CO2 emission per kilometer for commercial cars for 2020 and 2021.

Additionally, by 2030, the European Union wants to reduce CO2 emissions from Light Commercial Vehicles (LCVs) by 31%. Strict emission objectives for reducing nitrogen oxides (NOx) and carbon dioxide (CO2) in the air and predicted diesel bans in Europe cities like Paris and Madrid have already started announcing diesel bans are primary regulatory measures. Currently, 200 European cities have access restrictions and low-emission zones, with the U.K., Germany, and Italy leading the way. The European market is expanding due to diesel bans and other environmental laws requiring truck manufacturers to incorporate electric trucks in their product lines.

North America Market Trends

North America is the third largest region. North America includes countries such as the U.S., Canada, and Mexico. Many market players and extensive R&D activities are expected to drive the electric truck market in North America. For instance, Ford is investing more than USD 6 billion in the US Michigan plant for manufacturing the F-150 hybrid electric truck. The company is expected to introduce an all-new F-150 and an F-150 hybrid electric truck version in 2020. Increasing fuel costs and stringent governmental regulations about carbon dioxide emissions are pushing the adoption of electric and hybrid electric vehicles in this region. In addition, high investment in electric trucks, owing to higher demand for zero-emission commercial vehicles, is expected to fuel the growth of the market in North America.

Market Segmentation

By Type Insights

Light and medium-duty trucks (urban delivery vans, box trucks, small refrigerated trucks, urban utility vehicles and Class 2B–3 fleets) are the fastest-adopting segment today. These duty cycles align well with battery electric powertrains because of predictable routes, return-to-depot charging, and shorter daily ranges. Total cost of ownership (TCO) parity is already achieved in many urban last-mile and municipal use cases (particularly in China and selected European cities), which is powering large fleet orders and pilot programs worldwide. Sales and deployments in 2024 were driven by parcel & e-commerce fleets, grocery & cold-chain logistics, and municipal services. In China, light and medium electric truck sales were over 80% of global EV truck sales in 2024, while in Europe, zero-emission medium- and heavy-duty truck sales in the same year were 10% of the market.

Heavy-duty long-haul trucks are progressing more slowly because battery mass, range, and charging time create operational and cost barriers for long-distance freight. Adoption is concentrated in regional, short-range heavy-duty applications (regional distribution, refuse collection, port drayage) rather than coast-to-coast long-haul routes. However, pilot hydrogen fuel-cell projects and electrification of rigid heavy vehicles (garbage trucks, mixers, yard tractors) are increasing. Expect heavy-duty electrification to scale more strongly in the late 2020s and into the 2030s as battery energy density improves, fast-charging infrastructure expands, and hydrogen encouraging ecosystems develop.

By Propulsion Insights

BEVs dominate today for last-mile and urban/regional trucking because of superior efficiency, lower operating cost, and simpler drivetrain maintenance. Global sales of medium and heavy-duty (MHD) electric trucks grew by almost 80% in 2024 to exceed 90,000 units, and the majority of these sales were in China. BEV growth is being driven by lower battery costs, fleet electrification pilots from parcel/logistics companies, and expanding depot charging. Expect BEVs to remain dominant in short and mid-range duty cycles through 2030.

Fuel Cell Electric Trucks (FCEV) are emerging as a promising alternative for long-haul and high-payload applications. Although adoption remains limited, ongoing hydrogen corridor projects in Europe, Japan, and the U.S. are expected to fuel strong double-digit growth rates post 2027.

Plug-in Hybrid Electric Trucks (PHEV) currently occupy a niche position. They appeal to operators requiring operational flexibility, but their market share is projected to decline as BEVs and FCEVs become more cost-competitive and infrastructure expands.

By Application Insights

The last-mile delivery segment leads the market, supported by rapid e-commerce growth and government policies promoting zero-emission vehicles in urban areas. This segment benefits from defined routes, centralized depot charging, and low total cost of ownership, making it the most mature application. Regional distribution and long-haul freight are expected to have strong growth as manufacturers launch higher-capacity battery models and hydrogen trucks. Europe and China are expected to be ahead in terms of adoption due to aggressive decarbonization targets and infrastructure development.

Construction & mining applications are gaining grip, especially in controlled environments where centralized charging is feasible. Electrification here is driven by emission reduction targets at mining sites and noise-sensitive urban construction zones. Municipal & Utility Services represent a steadily growing niche. Electric refuse trucks, street sweepers, and utility service vehicles are being widely procured by city governments to meet sustainability goals. This segment benefits heavily from subsidies and dedicated urban charging points. The Others category, which includes refrigerated trucks, specialty vocational vehicles, and retrofitted fleets, will see selective adoption depending on payload and range requirements. Innovations in modular battery packs and fleet customization are expected to drive future opportunities in this space.

List of key players in Electric Truck Market

1. AB Volvo
2. BYD Company Ltd.
3. Daimler AG
4. Dongfeng Motor Group Co.Ltd.
5. MAN SE
6. Rivian
7. Scania AB
8. Tata Motors
9. Tesla
10. Workhorse

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Recent Developments

• July 2025- Tata Motors is in the process of acquiring Iveco Group's commercial vehicle business in a deal valued at approximately €3.8 billion. The acquisition aims to strengthen Tata Motors' presence in the European market and leverage Iveco's electrification technology. The deal is backed by a $4.5 billion bridge loan and is expected to be finalized by April 2026, pending regulatory approvals.
• August 2025- Ford announced a new midsize, four-door electric pickup truck as the first vehicle to be built on its new "Universal EV Platform." The company is investing approximately $5 billion in its Louisville Assembly Plant and BlueOval Battery Park Michigan to produce the vehicle and its prismatic LFP batteries. The truck is targeted for a 2027 launch with a starting price of about $30,000.