Blue Energy Motors, a leading liquefied natural gas (LNG) truck manufacturer, is seeking to secure USD 100 million in funding to support its foray into the electric vehicle market. The entire process of fund raising is expected to conclude within the next three to six months, Anirudh Bhuwalka, CEO of Blue Energy Motors, told Autocar Professional.
Blue Energy Motors raised approximately USD 10 million in its previous capital raise about a year ago in 2023. Notable investors in the first round of funding included FPT Industrial — a part of the Iveco Group that supplies engines for Blue Energy Motors' LNG trucks.
Electric trucks have potential in short-haul applications, Bhuwalka said. However, the major challenge is financing, as the capital costs are much higher for electric trucks. For instance, the initial cost of an electric truck would be around Rs 1 crore compared to 60 lakh rupees for an LNG truck and around Rs 40 lakh for a diesel truck. Moreover, the payback period for an electric truck would be around four years due to the higher fuel savings compared to 18 – 24 months for an LNG. So, it is only after four years that the investment in an electric truck will see good returns.
If banks and other financial institutions provide favourable financing for electric commercial vehicles, it will significantly boost adoption, the top executive added. Blue Energy Motors sold around 400 of its LNG trucks last year.
The development should be seen in the context of India's trucking market, which is expected to grow four times larger — from four million trucks in 2022 to 17 million trucks by 2050. The development will help boost the nation's economy but also increase transportation emissions. As per the recent Niti Ayog report, LNG provides a compelling alternative to diesel trucks. It is expected that LNG heavy duty vehicles (HDV) sales per year will reach 10% by 2032.