How can Manufacturers and Dealers Navigate Electrification in the Transportation Industry

Aug 20, 2021


Electrification is on the rise within the transportation industry for various reasons. A growing number of equipment manufacturers, dealers, and end users are therefore needing to invest in electrified logistics transport, and transition solutions.

Here we look at some of the key drivers of the electrification trend in transportation and the best ways for vehicle manufacturers and dealers to support their customers to finance their demand for electric buses, LCVs (Light Commercial Vehicles), last mile delivery trucks, and other goods transport related assets, such as trailers and cooling units.

Legislation and reduced emission goals accelerate adoption of electric vehicles

In many countries around the world, legislation, and emissions restrictions are already driving the transition to electrification, and this will undoubtedly continue. Electrical vehicles will become compulsory in certain areas, leading to fast widespread adoption, and the growing need for transition solutions and the associated infrastructure, such as charging stations.

The Netherlands government, for example, has declared that logistics transport in Dutch cities must be emission-free by 2025, and that from 2030 there will be a ban on combustion engine sales, with all road transport to be emission-free by 2050.

In the USA, the state of California issued a mandate, requiring all commercial trucks sold in the region to be zero-emissions by 2045. Shortly after, 15 additional US states made a similar commitment to zero-emissions trucks by 2050*.

Business sustainability goals and climate change

For many businesses, electrification will be a key part of their ongoing push towards sustainability. There is a growing appetite for sustainable solutions from equipment users and buyers. DLL supports this, with a focus on sustainable business models that marry profitability for our partners with environmental and social benefits, while enabling companies to invest in ‘greener’ transportation assets.

Expansion of available products and resulting competitive growth

Given the simplicity of how an electric vehicle is manufactured, compared to a vehicle with an internal combustion engine (ICE), the manufacturing process will have a knock-on effect all the way down the supply chain.

One of the main challenges within the truck market is to achieve affordable total cost of operations, while adopting new, expensive technologies. However, after the initial investment, businesses can anticipate future savings, due to the elimination of fuel costs and the decreased level of maintenance required.

The challenges of investment

Electrification and automation are the two areas receiving the highest investment in the transportation sector, a trend also seen in the wider automotive industry.  DLL is at the forefront of emerging technologies, and therefore already offers finance solutions for electric vehicle suppliers, as well as solutions to support the cost of additional services such as charging infrastructure, tires, roadside assistance, telematics, repairs, and maintenance.

For many businesses, upfront investment in new technologies is the key challenge, and quite often, there is insufficient cashflow available to fund the transition to electric vehicles outright. DLL finance solutions help support these businesses, transforming their investment from CAPEX, to an OPEX solution, with manageable monthly fees that simplifies the change, and justifies the financial investment.

However, flexibility remains critical, as solutions for the electric transition today may not be the right match a few years down the line as technology evolves. Businesses will therefore need continued financial support to invest in new sustainable solutions as they emerge.


Clean energy. Clean Technology.

Clean energy, and clean technology are an important part of DLL’s business model, so there is a strong desire to help fund the transition to fully electric vehicles.  Below are two examples of partnerships that DLL has developed, which demonstrate this.

DLL working in partnership with Xos Trucks

Xos Trucks is a leading manufacturer of fully electric commercial vehicles and is working in partnership with DLL to provide financing for electric trucks.   The partnership is designed to enhance the transition from traditional diesel-powered trucks to electric-powered, at a time when the focus on climate change is magnified and regulation are intensifying, pushing businesses to strive towards achieving zero emissions.

DLL working in partnership with Picnic

Online supermarket, Picnic, is growing fast with its green mass-market approach to online grocery shopping. When Picnic continued to expand its German operations in 2019, they turned to asset financing specialist DLL to help finance its large fleet of delivery vehicles. At the time, Picnic was buying all of its vehicles with cash, so substantial capital was tied up in their fleet.

DLL helped the company free up cash from its existing electric fleet to finance its growth strategy, and provided additional financing for new delivery vehicles to meet Picnic’s upsurge in demand.

The scale of this project was unique and DLL spent time understanding the electric vehicles, which are not yet standard assets. With Picnic growing its fleet very rapidly, it’s been a challenge to get all of the pieces in place, the lease structures and documents, invoicing and equipment delivery processes, but DLL was able to provide the financing they needed, when it really made a difference.

How DLL Helps Manufacturers and Dealers in the Transportation Industry

DLL supports customers in the transition towards a zero emissions fleet, by enabling manufacturers and dealers to offer their customers tailored finance package to cover investment in new vehicles, as well as charging infrastructure, fleet maintenance, fleet management, and retrofit solutions, such as converting diesel engine vehicles into those with electric battery powered engines.

As a business, we have already begun to build solid professional and mutually beneficial relationships in the electric commercial vehicles market to offer further knowledge and support to manufacturers, dealers, and end users.

Well-informed, with a sophisticated view on asset costs, life cycles and associated residual values, to stay ahead of the curve, DLL offers flexible, up-to-date solutions to help customers stay at the forefront of the latest transportation trends. This includes a range of mobile and digital solutions for online buying and leasing.

With a global footprint, the expert DLL team also offers multinational support for businesses worldwide, including global master lease agreements that can cover multiple countries, regions, brands, and asset types.   DLL also offers pay-per-use (PPU) leasing options to help customers achieve greater cost and revenue alignment for their businesses, as well as significant operational flexibility.

The E-Mobility program from DLL Rabobank

DLL has an E-Mobility program with Rabobank, with an aim to build new commercial propositions to support customers in their transition towards a zero emission fleet.

A recent questionnaire carried out by the companies revealed that the transition towards a zero emission fleet was already on the agenda for 53% of respondents. It also revealed the preferred route was identified as making small vehicle investments at one time via a lease, with charging infrastructure included. Together DLL and Rabobank hope to offer businesses an interesting proposition including financing, charging infrastructure, fleet maintenance, fleet management and more.

Learn more

To discover more about the trend towards electrification in the transportation industry, and to learn how DLL can help you, please get in touch with Michael Hart (New Business Development Americas) or Martin Joli (Global Head New Business Development), or visit our DLL  Transportation solutions page for more information.


*PowerMag -