When will hybrid technologies dominate the heavy-duty vehicle market? : Forecasting Using Innovation Diffusion Models

Sammanfattning: Hybrid-electric technologies have recently been introduced into the market for heavy-duty vehicles (HDVs). However, challenging an established technology with a new and untried technology is difficult, also under the best conditions. Forecasting is a vital tool in product portfolio management, since it provides guidance on how much resources a firm should allocate on new innovative projects and products and when and where to enter the market. Therefore, this thesis forecasts the market penetration of hybrid HDVs in Europe by usage of innovation diffusion models – based on three different market scenarios assuming no, some and considerable incentives or legislative CO2 for HDVs. Hybrid-electric, hydraulic hybrid and flywheel hybrid vehicles are considered and an analogical approach is used based on sales data for radial tyres, disc brakes and anti-lock braking systems. The result from a non-linear regression analysis indicated that innovation diffusion models of mixed influence are capable of predicting future market demand, not only of hybrid HDVs, but also of other HDVs with new innovative technologies or solutions. Therefore, it was suggested that innovation diffusion modeling should be a standard tool in the strategic planning of a HDV firm’s all new innovative products. All market scenarios resulted in a rather low diffusion speed of hybrid HDVs during the first ten years, but the speed increased then rapidly during the next ten years such that 40-50 percent of the HDV market was penetrated in 2030. In the most hybrid-friendly scenario, the market was nearly fully penetrated after 50 years since the first introduction in 2010, while in the least hybrid-friendly scenario additional ten years was needed to fully penetrate the HDV market. The forecasts may be affected by possible pre-diffusion, the emergence of a dominant design or the diffusion acceleration effect. One of the major challenges of using innovation diffusion models for sales forecasting of hybrid HDVs, was to find appropriate and sufficient analogous sales data. Therefore, Thomas (1985) analogous approach was further developed to be more focused on finding analogous sales data from internal, external or public sources.