CNG Trucks Can Cut Haulage Operating Costs By 40% -Firm

The Co-founder and Chief Executive Officer of Lori Systems, Jean-Claude Homawoo, has said the adoption of compressed natural gas (CNG)-powered trucks could reduce haulage operating costs in Nigeria by between 30 and 40 per cent, offering relief to transport operators battling rising energy and logistics expenses.

Homawoo, who spoke at HAULMACE 2026, said the transition to alternative energy sources, particularly CNG, presented an opportunity for the haulage industry to reduce fuel expenditure and improve operational efficiency.

He cited figures presented at the event showing that a loaded truck travelling from Lagos to Abuja could spend approximately N146,000 on gas, compared with about N553,000 on diesel.

According to him, the difference highlights the potential cost savings available to haulage operators willing to embrace gas-powered transportation.

He said estimates from fuel marketers indicated that CNG adoption could deliver savings of between 30 and 40 per cent in total operating costs, depending on prevailing energy prices and operational conditions.

However, he noted that the expansion of CNG-powered transportation would depend largely on the availability of refuelling infrastructure across major transport corridors.

Homawoo said Nigeria had about 50 CNG stations nationwide in early 2025, stressing that more investments in infrastructure would be required to support the widespread adoption of gas-powered heavy-duty vehicles.

He also identified challenges surrounding the price and availability of gas following changes in the fuel subsidy regime, noting that the commercial viability of CNG trucks would depend on reliable supply and accessible refuelling facilities.

Beyond CNG, the Lori Systems CEO highlighted the potential of electric trucks to reduce energy costs and maintenance expenses in the road freight sector.

Drawing on developments in Kenya, he said electric vehicles were increasingly being explored for freight operations, with figures presented at the event indicating that an electric truck could consume approximately 1.3 kilowatt-hours per kilometre.

He said the cost of powering an electric truck along the Mombasa-Nairobi route could be about one-quarter of the cost of diesel under the applicable e-mobility electricity tariff, and fall to approximately one-eighth when overnight charging was used.

According to him, electric trucks also offer maintenance advantages because their motors have fewer moving parts than conventional diesel engines.

He, however, acknowledged that electric freight vehicles face challenges, including the weight of batteries, which could reduce cargo-carrying capacity, as well as the time required for recharging.

For Nigeria, he said the commercial viability of electric trucks would depend significantly on addressing the country’s electricity challenges.

Homawoo noted that grid electricity tariffs could make charging more expensive than gas in some circumstances, while unreliable power supply remained a major obstacle to the adoption of electric vehicles.

He suggested that haulage operators could explore generating electricity through gas-powered turbines at charging depots instead of depending entirely on the national grid.

He disclosed that at least one company was already working on a gas-powered charging station, describing the development as an indication of the opportunities available in combining alternative energy sources to support electric freight transportation.

Empty truck runs, poor coordination inflate costs

Beyond energy costs, Homawoo identified inefficiencies in truck movement, cargo coordination and fleet utilisation as major factors driving up the cost of transporting goods in Nigeria.

He said the high cost of moving goods was not caused solely by rising fuel prices and poor road infrastructure but also by operational challenges, including cargo diversion, prolonged waiting times and trucks returning without loads.

According to him, these inefficiencies increase transportation expenses, with the additional costs ultimately passed on to consumers through higher prices of essential commodities.

He identified poor coordination between cargo owners and transport operators, delays at loading and unloading points and the inability to secure return loads as major challenges confronting the country’s road freight sector.

Homawoo explained that when trucks travelled long distances to deliver goods but returned empty, operators were forced to absorb the cost of journeys that generated no additional revenue.

He said the cost of empty return trips was eventually reflected in the charges for the initial delivery, making freight transportation more expensive for businesses and consumers.

The Lori Systems CEO argued that improving the utilisation of existing trucks could deliver significant savings without necessarily requiring an increase in the size of the national truck fleet.

He said better coordination between shippers and transport operators would ensure that trucks delivering goods to particular destinations could secure cargo for their return journeys, thereby reducing wasted capacity and operating costs.

He also identified delays at loading and unloading points as a major source of inefficiency, explaining that trucks waiting for cargo or clearance were assets unable to generate income.

He called for a shift from fragmented arrangements towards a more coordinated freight ecosystem, where technology could connect cargo owners with available transport capacity.

According to him, digital platforms could improve the matching of trucks with cargo, provide greater visibility into the movement of goods and enable operators to make better use of their fleets.

He said technology could also reduce administrative bottlenecks through digital documentation and improved communication among participants in the supply chain.

Homawoo noted that freight coordination solutions did not necessarily have to be complicated, pointing to the use of familiar communication platforms such as WhatsApp to make digital coordination more accessible to operators.

On financing, he said the haulage industry needed models that recognised the value of contracts and the creditworthiness of shippers rather than relying exclusively on conventional lending arrangements.

He explained that transport operators could access financing based on the strength of their relationships with cargo owners and the reliability of the businesses they were contracted to undertake.

He also proposed a more flexible truck ownership and deployment arrangement under which businesses could have dedicated trucks when required, while the vehicles could be deployed to serve other customers during periods of lower demand.

He said the model would improve asset utilisation and reduce the financial burden associated with keeping trucks idle for extended periods.

Industry urged to embrace collaboration

The discussions formed part of HAULMACE 2026, which brought together stakeholders in the haulage and logistics sector to examine the role of technology and collaboration in improving freight transportation.

In his opening remarks, the convener, Alfred Okugbeni, said the platform had been bringing industry stakeholders together since 2015 to address challenges confronting the sector.

Okugbeni said Nigeria’s haulage industry continued to contend with underinvestment and underutilisation of trucks, adding that digital freight platforms, smart backhauling, fleet management and real-time tracking could help address some of the challenges.

He identified technology companies, including Jetstream Africa and Lori Systems, as participants in the evolving Nigerian market.

However, he stressed that technology alone would not resolve the industry’s problems without stronger cooperation among participants in the supply chain.

He called for collaboration among shippers, manufacturers, cargo owners, haulage operators, logistics service providers, freight forwarders, distributors, technology providers, banks, insurance companies and government agencies.

According to him, collective action would improve efficiency, reduce costs, strengthen visibility across the supply chain and enhance the competitiveness of Nigerian businesses.

Okugbeni said HAULMACE was designed not merely as a discussion platform but also as an opportunity for industry players to connect, build relationships, do business and develop practical solutions to challenges confronting the sector.

The discussions reinforced the need for Nigeria’s freight industry to look beyond acquiring more trucks and focus on improving the utilisation of existing capacity, reducing energy costs and deploying technology to make haulage operations more efficient.