By LIU Jiaxin
On-demand road-freight operator Huolala has filed an IPO application at HKEX. Best known for its popular truck-hailing app, the company’s prospectus lays out a plan to develop a commercial electric vehicle.
Switching to environmentally responsible companies
The company’s intention to make EVs can be traced back to 2021 when it launched a recruitment drive for car-making talent.
At the time, Huolala claimed it was hiring so many specialist staff as a “talent reserve.” Last year, the company spent 10.5 billion yuan (US.52 billion) on a plot of industrial land in Southwest China’s Chongqing. The land is reported to be used as the base for Huolala’s automotive acceleration.
Huolala’s bold move is driven by the current trend for so-called green logistics. Huolala’s revenue grew from US$530 million in 2020 to US$1 billion last year and turned a profit for the first time last year of US$53 million. Consumers are increasingly supporting environmentally responsible companies and Huolala cannot afford to be left behind. Green logistics practices help attract and to retain customers.
The term describes the integration of environmental considerations into the logistics process to minimize the ecological impact of the cargo business. Green logistics includes efficient and sustainable supply chain management practices.
National plan for green logistics network
Last year China released its first national five-year plan for logistics with the aim of building a smart, green logistics system by 2025. The plan stresses improvements to the resilience and safety of the industrial and supply chains, construction of a modern logistics system to cut the costs of transporting goods. By 2025, a system will be in place that is efficient, intelligent and green, according to the plan.
A prominent trend in the green logistics plan is the move toward EVs with their advantages over traditional diesel-powered vehicles, including lower emissions and operating costs. Many logistics companies around the world are already switching to EVs for their local operations, and this trend will likely continue.
In 2022, over 200,000 e-trucks were delivered in China, the leader of the pack by far. In terms of medium and heavy-duty trucks, China is forecast to remain the world’s biggest market until 2030 at least. China also has a strong position on fuel cell vehicles, selling the majority of fuel cell trucks and buses in 2021 and 2022.
