Analysis — “The Harsh Reality of Green Logistics Transition”

(Based on the presentation by Ms. Nguyễn Thị Thu Hiền, Southern Branch Director of Delta International JSC, at the workshop on hydrogen injection technology for internal combustion engines to reduce fuel consumption and emissions, organized by VAHC and UEF with the support of Ikonomy on September 16, 2025)

[Photo: UEF]
Ms. Nguyễn Thị Thu Hiền presenting at the workshop.

Brief Summary from Delta International JSC

Delta operates 359 vehicles, including 221 heavy-duty diesel trucks (10–15 tons); total annual fuel consumption ~3.27 million liters; estimated emissions 8,894 tCO₂/year.

If carbon credits are purchased at $5–10/tCO₂, Delta’s annual carbon cost would be ~$44,470 – 88,940. Extrapolated to the nationwide logistics sector, total carbon credit cost could reach ~$183.75 – 240 million USD/year.

Vehicle cost comparison (from slide): Diesel ≈ $45,000; EV ≈ $150,000; Hydrogen truck ≈ $400,000.

95% of freight transport in Vietnam still relies on fossil fuels; rail’s modal share is very low (e.g., only 0.19%).

Key barriers identified: high investment costs, customer mindset (“want green but won’t pay more”), lack of infrastructure & after-sales service, lack of pilots/showcases — “no showcase, no benefit proving; operation cost are still unclear.”

1. Core Issue — “Customers Want Green but Won’t Pay Extra”

Ms. Hiền highlighted the paradox:
External pressure (international partners, consumers, carbon market opportunities) forces logistics firms to decarbonize, while internal pressure (high costs, price competitiveness) makes it very difficult to pass costs onto customers.

Result: many companies have “green transition” plans, but actual implementation rates remain low (65% have plans but only 34% are executing).

Practical implication: without operational evidence and cost-sharing models, logistics companies will delay investments — slowing down the nationwide transition.

2. Technology Comparison — Strengths and Weaknesses (from file)

Current Diesel Trucks
Low CAPEX (~$45k), existing infrastructure, mature after-sales services.
But emissions are high.

Battery Electric Trucks (BEV)
CAPEX ~3× diesel (~$150k).
Benefits: zero tailpipe emissions, high motor efficiency, potentially lower long-term fuel (electricity) cost.
Limitations: range, charging time, payload loss due to batteries, sparse charging network, complex import/inspection process.

Hydrogen Fuel-Cell Trucks
CAPEX ~9× diesel (~$400k).
Benefits: fast refueling, diesel-like range, ideal for long haul.
Limitations: very few H₂ refueling stations, high vehicle cost, immature H₂ supply chain.

Intermediate Solution — Hydrogen Injection/Blending into Diesel Engines
A partial decarbonization solution without full vehicle replacement.
Advantages: leverage existing assets, lower CAPEX compared to full fleet replacement.
Drawbacks: emission reduction not as high as BEV/H₂ fuel-cell, engine adjustment required, safety concerns, and H₂ supply must be ensured.
(This was highlighted in the file as a practical approach worth piloting.)

3. Import & Type-Approval Hurdles

Since BEV and H₂ trucks are new technologies, import and registration processes remain lengthy and complex — creating administrative barriers that slow deployment.

Practical approach: instead of waiting for complete regulatory overhaul, start with pilot projects under temporary mechanisms (e.g., trial permits, simplified temporary import procedures, sandbox approach for registration) to collect real operational data that can inform future regulatory reform.

4. Proposed Pilot Project Plan — Three Parallel Technology Tracks

Overall Goal: create real-life showcases, measure operating costs accurately, prove benefits, and convince customers and policymakers.

A. Pilot A — BEV Trucks

• Scale: 2–5 BEV trucks (depending on funding) for short-haul/urban routes (with charging stations nearby).

• Duration: 12 months of data collection.

• Partners: vehicle suppliers, charging infrastructure developers, local DoT/inspection agencies, one large anchor customer committed to using the pilot service.

• Metrics: tCO₂/km reduction, operating cost (VOM) per km, downtime, charging time, customer satisfaction.

• Expected outcome: establish clear 5–7 year TCO, compare with diesel to justify a premium. (Pilot answers the real-world OPEX question raised in the file.)

B. Pilot B — Hydrogen Fuel-Cell Trucks

• Scale: 1–2 trucks (due to high CAPEX) for mid/long-haul routes; prioritize locations with H₂ availability or easy H₂ supply access.

• Duration: 12–18 months.

• Partners: H₂ truck supplier, H₂ provider, financial institutions for CAPEX support.

• Metrics: tCO₂/km, H₂ fuel cost (VNĐ/kg), maintenance cost, refueling time, long-haul operability.

• Objective: evaluate practicality for long-haul freight, compare with diesel and BEV.

C. Pilot C — Diesel + Hydrogen Injection

• Scale: 5–10 retrofitted diesel trucks for long-haul/mixed routes.

• Duration: 6–12 months (including kit installation and engine calibration).

• Partners: H₂ injection kit supplier, service workshop, safety & inspection authority.

• Metrics: % diesel reduction, % CO/NOₓ/CO₂ reduction, cost per kit/vehicle, impact on engine lifespan.

• Advantage: lower CAPEX than full fleet replacement, faster transition step.

5. KPIs & Evaluation Methods (for all pilots)

• Actual emissions reduction (tCO₂) per route and fleet-wide.

• Operating cost (VOM) VNĐ/km: fuel + maintenance + labor.

• TCO over 5 and 10 years (CAPEX + OPEX).

• Uptime/downtime ratio (availability).

• Customer acceptance (pre- and post-surveys on willingness-to-pay premium).

• Infrastructure needs: required number of chargers/H₂ stations, payback period if shared among operators.

Data will be visualized via a transparent dashboard for easy reporting to customers and sponsors.

6. Funding Model Suggestions (to Mitigate High CAPEX)

• Shared CAPEX structure: joint venture among OEMs, Delta, and public-private funds.

• Leasing / Operational Lease: for BEV/H₂ trucks to avoid upfront CAPEX burden on logistics companies.

• Green Service Contracts: anchor customers agree to pay a small “green premium” (e.g., +x% on logistics fees) during pilot, in exchange for transparent emission reduction reports.

• Carbon credit monetization: apply internal carbon pricing and use part of pilot benefit to offset CAPEX (file provided carbon price ranges for reference).

7. Policy & Regulatory Recommendations

• Sandbox / fast-track procedures for type approval and temporary import of pilot vehicles.

• Tax incentives (import duty, VAT, corporate income tax) for early-stage green vehicle deployment.

• Shared infrastructure support: dedicated infrastructure investment funds for charging/H₂ stations.

• Technical standards for hydrogen injection solutions to ensure safety and performance.

• Training & communication programs (eco-driving already implemented at Delta — should be scaled up).

8. Recommended Commercial Rollout Roadmap

• Phase 0 (0–3 months): establish pilot steering committee (Delta + suppliers + customers + regulators + financiers), prepare contracts and sandbox permits.

• Phase 1 (3–15 months): run all three pilots in parallel (BEV, H₂, hydrogen-blend); collect weekly/monthly dashboard data.

• Phase 2 (15–24 months): analyze TCO results, propose scale-up financial models (leasing, green premium), request policy expansion.

• Phase 3 (>24 months): regional rollout, infrastructure expansion, long-term service contracts with major customers.

9. Condensed Conclusion

Green transition is inevitable but must be paired with operational evidence and cost-sharing models to solve the “customers want green but won’t pay more” challenge — or be supported by state incentives.

Pilots for each technology (BEV, H₂, hydrogen-blend) are essential steps to prove benefits and validate real operating costs. No pilot = no persuasive case for customers and investors.

Cross-sector collaboration (government — logistics firms — technology providers — financiers) will ultimately determine the pace of transition.

Executive Summary

• Fleet size: 359 vehicles; fuel consumption ~3.27M L/year; emissions 8,894 tCO₂/year.

• Vehicle CAPEX (slide): Diesel ≈ $45k; EV ≈ $150k; H₂ ≈ $400k.

• Main barriers: high CAPEX, customer unwillingness to pay premium, infrastructure gaps, import/approval bottlenecks, lack of operational showcases.

• Recommendation: run three parallel pilots (EV, H₂, hydrogen-blend), measure TCO & emissions, apply shared CAPEX / leasing models, and use policy sandboxes to accelerate adoption.