Road and Air Transport Sectors To A Greener Future in The Uk: Lessons For Vietnam
Road and Air Transport Sectors To A Greener Future in The Uk: Lessons For Vietnam
Road and Air Transport Sectors To A Greener Future in The Uk: Lessons For Vietnam
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
consulting report tends to focus on the transport sector. LNG will penetrate 30% and 3% more by 2040,
The question is how the net-zero goal will impact the UK respectively. Thus, it would seem that the UK's future key
transportation industry. technologies are EV, HFCV, and Biofuel. The
According to KPMG LLP (2019)[21], driven by the transformation is in the prime minister's Ten Point Plan,
introduction of the UK Government's ban on gasoline and with three points related to the transport sector
diesel from 2040, electric vehicle (EV) sales were up over significantly, Point 4 (Accelerating the Shift to Zero
60% in April 2017, and they are expected to be rapidly Emission Vehicles), Point 5 (Green Public Transport,
increased to 70% in 2030 and over 90% in 2040, though Cycling and Walking), and Point 6 (Jet Zero and Green
EVs only account for 1% of new car sales in the UK in Ships). In addition, the transport sector also relates to the
2018. Those are changes when the UK is just in its power and heat sectors. In the power sectors, EV batteries
infancy in the first stage of the carbon reduction process. are expected to bring stability to the grid as a flexible
KPMG analysis shows that, for Heavy Goods Vehicles source of power in managing supply and demand. Table 1
(HGVs), alternative fuel sources such as HFCVs and shows the expected impacts for the UK transportation.
Table 1 – The UK expected transitions and impacts
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
The aviation sector: Through the Industrial Strategy, the government has set out its ambition to create a
push forward low carbon travel green economy. According to The Ten Point Plan of the Prime Minister,
the UK action will cement their position as a global leader in aerospace and position the UK at the
forefront of the zero-emission aircraft revolution. The government will run a £15 million competition to
support the production of Sustainable Aviation Fuels (SAF) in the UK, building on the success of the
Future, Fuels for Freight and Flight Competition. Meaningful government support is the driving force
behind the airline industry in innovation, research and development.
From 2030, the UK will end sales of new petrol and diesel cars and trucks. The accompanying £2.8
Economic billion investment package demonstrates their belief in the auto manufacturing industry as the backbone
factors of the UK. The UK is a leading manufacturer of Electric Vehicles such as manufacturing Nissan Leaf
(KPMG, 2019). The changes in the UK policy require businesses to transition quickly to produce aircraft
and vehicles that ensure reduced carbon emissions. However, problems with the cost of producing and
importing green fuels such as hydrogen and biogas in the transport sector are likely to require much of
the same infrastructure and renewable sources as end-users. In addition, costs and benefits of climate
policies and the ability to shape such policy is not extended equally to those who suffer the greatest costs.
Inclusion is vital to ensure that policy is socially equitable (Abram et al., 2020).
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
The transition to net-zero will not be sustainable or credible for the road and aviation sectors if it creates
Sociological or worsens social inequalities. A social justice approach can facilitate the transition globally. The
factors government could deliver up to 3000 jobs by 2025 in public transport and up to 5200 jobs supported by a
domestic SAF industry (HM Government, 2020). Job creation does not guarantee just outcomes. It must
take into account what jobs are created, how secure they are, who has access to them and the skills and
education required. In addition, it is essential to use alternative fuels such as biofuel to operate electric
vehicles. Nonetheless, biofuel produces from alcohol and fermented corn, which can occupy many lands
to grow maize for biofuel production. It turns to threatens food security, farm market, land issues, water
scarity, and even drivers or pilots have to accept lower vehicle or airplane performance to ensure reduced
emissions.
Besides, the fear of Coronavirus has already hit the industry hard. Apart from the shutdown of several
airports worldwide, several airlines involving Flybe in the UK have been severely affected. Coronavirus
has spread in society leading to people cutting back on travel to foreign destinations, affecting airline
revenues and other costs associated with maintaining planes (Vickerman, 2021).
The road sector: As for technological factors, the CCC expects all new car sales to be electric by 2035;
Technological creating a new source of power demand but also storage. Demand for hydrogen to power Hydrogen fuel
factors cell vehicles (HFCV) may also be produced via electrolysis from renewable sources, further raising
power demand. Faced with the need to improve technology in fuel production for electric vehicles,
businesses in the trucking industry need to explore, measure, and improve the efficiency of EV batteries,
hydrogen electrolysis, and biofuels (KPMG, 2019). Unique and effective technology element brings a
competitive edge to businesses in the industry to meet UK customer needs and regulations.
The aviation sector: Technology has been central to the growth of the aviation sector, and in addition to
more fuel-efficient and safer aircraft, the development of better sales and service technologies has also
supported faster growth of the aviation sector. Net-zero goal 2050 pushes the airline industry to explore
and measure for decarbonizing that have become critical to the performance and reputation of
companies. The higher focus on technology has helped aviation companies to handle the key challenges
arising from Brexit and Corona-virus with greater efficiency. Additionally, the aviation sector also
receives investment from the government to invest £15 million into FlyZero – a 12-month study,
delivered through the Aerospace Technology Institute (ATI), into the strategic, technical and commercial
issues in designing and developing zero-emission aircraft that could enter service in 2030 (HM
Government, 2020).
Legal factors is one of the most vital concerns in the entire aviation and vehicle sectors in the UK market.
Legal factors Compliance is crucial for all airlines and transportation companies as failure can lead to heavy fines and
also damage the brand's reputation. Industry regulatory factors may be related to labor rights, consumer
rights, passenger safety, or environmental impact. Examples of reputable damage include the emissions
scandal from the UK's most popular car manufacturers such as Mercedes, BMW, Volkswagen, and Audi
(The Guardian, 2019). The emissions cheating allegations has many consequences such as loss of
customer confidence, fees to pay fines, and compensation to car owners. Thus, legal compliance is of
paramount importance for businesses to pay special attention to in the context of the UK moving to the
first major economy to legislate for net-zero emission by 2050.
Environmental factors are at the forefront of operators as well as the air and road transport authorities.
Environmental Environment impacts on industries are of the utmost concern for UK regulators. Businesses need to take
factors some reliable steps in the right direction to minimize their environmental impact to make their business
models more sustainable. Sustainability is now one of the core areas of strategic importance for corporate
branding to increase the fuel efficiency of transport vehicles' carbon footprint. Accompanying HM
Government (2020), UK companies have to proactively plan to achieve the net-zero goal GHG emissions
by 2050. Enterprises in the road and air sectors also need to continuously update their methods and new
technology to control carbon emissions. There are several reasons behind the increased focus on
sustainability, some of the main reasons include a better reputation and social image (applying CSR),
incentives from the UK government as well as improving operational efficiency and customer
satisfaction.
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
In line with Suzanne Benn et al. (2013)[6], principles of sales increased by 60% over the same period last year and
Sustainability performance are a sustainable guarantee of in an increasing trend in 2030 and 2040. Regarding
ethics, transparency, community involvement, aviation, the UK has set goals and policies in R&D to
employment practices, stakeholder relationships, develop green planes. Along with utilities, there are
product/service value, governance, financial return, always disadvantages to use. Clean sources may save
environmental protection. The key issues present the fossil fuel and bring a friendly ecosystem, but they
challenge that is managing sustainably in the two chosen provide features that have to be considered and enhanced
sectors. over time. Electric energy is used to operate electric
vehicles (EVs) such as BEV, PHEV, PEV, HEV, Hybrid,
3.1 Shortcomings From Renewable Batteries
and NGV (Ali et al., 2019)[2]. Hydrogen electrolysis is
And Fuels used to operate alternative fuel sources such as HFCVs or
3.1.1 Issue
Bio-LNG. Evans-Pritchard (2020) states that hydrogen is
The road and aviation market trend is toward vehicles and
about to become the dominant energy force of the 21st
aircraft that reduce emissions, be environmentally
century. Bioenergy (Biofuels, Biodiesel, Bioethanol, and
friendly and save fossil fuels. The use of renewable
Biopropane) and solar power are used to run vehicles and
sources for passenger and freight transport is becoming
aircraft. Table 4 presents the key technological challenges
increasingly common in the UK following the
of alternative battery, fuel cell technologies, and solar
technological factors in PESTLE and Environmental line
power.
in TBL. According to KPMG (2019)[21], electric vehicle
Table 4 – Comparison on technological development challenges on alternative batteries and fuel cell technologies
clean crops early without much fertilizer, water, and other have seen, the UK has suffered one of the highest-ranking
inputs. For instance, corn alcohol made of biofuels is not of infection and death from the Covid-19. The economic
the ideal choice. It requires plenty of water, fertilizer, and recession and the prospect of mass unemployment are real
additional costs, to become expensive and affect problems and increasingly urgent, such as the global British
with food and land. But crops grown in marginal lands Airways pilot's strike, which affected hundreds of
offer potential. thousands of passengers (BBC News, 2020)[7]. Those
According to The Times (London, England) in 2020, who are flight attendants face a so-called "fire and
Tesla was considered a king of electric cars rented by replace" policy. Near Caerphilly, approximately 600
businesses. Lex Autolease, the group car rental company, headquarters had been lost at the aircraft engine
said that by the end of October, the number of electric maintenance plant run by the behemoth General Electric,
cars and trucks they rent to British firms had increased which before the pandemic employed 1,400 people (The
from more than 1,000 at the beginning of the year to more Guardian, 2020)[26]. When the economy is inactive,
than 2,500. Hence, instead of buying expensive electric small and medium enterprises (SMEs) will be the most
cars, we can use electric public transport such as electric vulnerable, they are closed because of their small
buses and rent electric cars, HFCVs or Bio-LNG vehicles potential but a large number. In the private sector, SMEs
from rental enterprises. account for 99.9% of the business population (6 million
businesses), achieving 61% of employment and 52% of
3.2 Job Creation And Human Capital For
turnover (Department for Business, Energy & Industrial
Green Economy Strategy, 2020)[14]. Figure 3 represents the transportation
3.2.1 Issue
sector as among the industrial sectors with the highest
The widespread unemployment of workers mentioned in
SME revenue and employment concerning national
the second issue leads them to urgently need the support
statistics 2020.
of policymakers for sustainable living in the future. As we
3.3 Cheating Emissions From Manufacturing of the road transport and aviation sectors, focusing on
Companies opportunities and bioenergy industry prospects in the
3.3.1 Issue future.
Toward emissions scandals, it is impossible not to 4.1 The Road Transport Sector
mention the brand Volkswagen (VW) in 2015. VW The problems of the road transport sector as the limitation
admitted to cheating half a million cars in the US and $11 of alternative sources, the lack of human resources for the
million worldwide to circumvent the rules about clean air green economy, or the fraud of emissions, in short, are
by software that makes emissions less toxic than they are. painful issues or risks related to principles of
VW has agreed to pay $14.7 billion to settle the scandal, sustainability performance such as governance,
mainly for car-owners to repair or buyback. In November employment practices, financial return, ethics, and
2016, Volkswagen announced it would cut 30,000 jobs environmental protection. In the future of 2050, traffic in
because of huge bills related to the scandal (CNN Money, the UK is forecast to have expected outcomes when the
2015)[10]. Lawyers representing more than 50,000 car national goals on tackling climate change are almost
buyers in the UK also sued VW in the High Court of blooming. From 2021 traffic is forecast to grow between
Justice, London. It is considered the largest class-action 20% and 58% by 2050. Carbon dioxide emissions from
lawsuit in legal history in the UK. After the "dieselgate" the road sector forecast to fall by between 16% and 80%
scandal, Hagens Berman UK, a subsidiary of a US law in 2050. The proportion of traffic in congested conditions
firm, filed a detailed lawsuit with the High Court of will rise from 10% in 2021 to 16% in 2050 because of the
Justice in London, alleging that Daimler, the maker of tendency to use more private vehicles. 2050 will be an
Mercedes-Benz, have set "defeat devices" to further year when the transtion to zero-emission vehicles is
artificially lower emissions (The Guardian, 2021)[31]. modeled in the chart that all of these vehicles are electric
Emission cheating not only exists at Volkswagen and or hydrogen. In fact, the combination of many advanced
Mercedes-Benz in the UK but also other manufacturers as technologies minimizes fuel inadequacies. This decision
Audi, Seat, Skoda could receive compensation by 2022 to model using electric vehicles reflects the ability to
for the installation of illegal 'defeat devices' to cheat provide better renewable sources to improve the
European Union emissions standards. performance of EVs and can be applied to other public
Moving onto the unfortunate owners of these cars, they transport.
have lost money and effort on things like hiring a lawyer,
preparing a lawsuit to claim compensation. Besides, the 4.2 The Aviation Sector
car corporation violated the laws of the host country or Regarding the aviation sector, the key issues mentioned
Europe, lost a lot such as attorney fees, court time, loss of like unemployment, unclear job creation policy, difficulty
car company reputation, stock decline, customer trust, and in obtaining suitable green fuels, and increasing
even shareholders. For the environment and society, the emissions, which are predicted to be resolved by 2050.
consequences are the increase of Greenhouse gas, and Regarding the aviation sector, the key issues mentioned
unemployment as companies cut human resources for like unemployment, unclear job creation policy, difficulty
compensation. This violation was classified as a violation in obtaining suitable green fuels, and increasing
of business ethics, subject to public opposition, and emissions, which are predicted to be resolved by 2050.
became an unsustainable corporation in the Sustainability Stakeholder relationships are even more vital to the
Change Matrix. That is the whole previous efforts to aviation industry with the UK's strategy for 2050 [Figure
become a sustainable corporation quickly dissipated. 4].
3.3.2 Recommendation Over the past 30 years, the aviation industry has seen
It is necessary to comply, effectively, and sustainably changes as the market share of low-cost airlines increases,
enforce the laws and regulations issued. Law enforcement meeting challenges ranging from volcanic eruptions to
agencies need clever checks to detect gaps in vehicle outbreaks of infectious diseases. The upcoming 30 years
manufacturers' emissions declarations early. are likely to be chaotic as the wave of technological
innovation unfolds. Technology is not the only source of
4. FUTURE SCENARIOS FOR THE disruption. We have always understood that political
BUSINESSES 2050 situations and institutions can always create surprises like
Brexit or presidential elections in the United States.
In the upper issues section, the authors evaluated and Government projections show that the aviation industry
highlighted the challenges or risks that exist. The future will continue to grow until 2050 with passenger numbers
scenarios section is the general forecast about the trends likely to increase by up to 70%.
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
natural resources exhaustion have been becoming more [6] Benn., S. (ed.) 2013, Sustainability at Work:
serious, effecting health and living of people and causing Readings, Cases and Policy, Australia, accessed 2
inhibition among society (MONRE, 2016)[34]. May 2021 from Amazon.com.
In the source of emissions from traffic, motorbikes are [7] BBC News (2020) ‘British Airway faces strike threat
considered the main culprit. Governments in the UK and over job cut plan’ (Accessed: 12 May 2021).
European countries are expecting green transportation as [8] Craig, C. A. and Allen, M. W. (2016). ‘Rethinking
one of the key solutions to overcome air pollution. After corporate social responsibility in the age of climate
evaluating the road and aviation sectors of the UK, change: a communication perspective’, International
Vietnam has to rethink and resolve the environmental Journal of Corporate Social Responsibility, Volume 1,
problems caused by utilizing transport. Part of the pride of Issue 1, pp. 1 – 11.
the Vietnamese people as the richest man in Vietnam - [9] CIPD (2017). What is a PESTLE analysis?, viewed 1
billionaire Pham Nhat Vuong also contributes to the May 2021,
reduction of greenhouse gas emissions through Vinfast's <https://www.cipd.co.uk/knowledge/strategy/organisa
vision of increasing the scale of electric vehicle and tional-development/pestle-analysis-factsheet#gref>
automobile production electricity from Vietnam to the [10] CNN Money (2015) ‘Volkswagen suspends 9
world (Bloomberg, 2021). With the current traffic managers over diesel scandal’, 10 December.
situation of a developing country like Vietnam, it is Available at:
necessary to have strict policies and sanctions on https://money.cnn.com/2015/12/10/news/companies/v
emissions for vehicles participating in traffic. It leads to olkswagen-scandal-investigation/index.html
infrastructure issues about the construction and (Accessed: 12 May 2021).
installation because there should be enough charging [11] Department for Transport. (2018). Transport Statistics
stations for the EVs. Thus, to provide recommendations to Great Britain 2018, Moving Britain Ahead. Available
environmental problems in Vietnam or any other country at:
comes with challenges in terms of the state budget, https://assets.publishing.service.gov.uk/government/u
legislation, and the transformation of companies to ploads/system/uploads/attachment_data/file/787488/ts
educate, marketing and change customers' energy and fuel gb-2018-report-summaries.pdf
usage to tackle the climate change in the nation. [12] Department for Transport. (2020). Transport Statistics
Great Britain 2020. Available at:
7. REFERENCES https://assets.publishing.service.gov.uk/government/u
[1] Abram, S., Atkins, E., Dietzel, A., Hammond, M., ploads/system/uploads/attachment_data/file/945829/ts
Jenkins, K., Kiamba, L., Kirshner, J., Kreienkamp, J., gb-2020.pdf
Pegram, T., and Vining, B. (2020). Just Transition: [13] Department for Transport. (2018). Road Traffic
Pathways to Socially Inclusive Decarbonisation. Forecasts 2018, Moving Britain Ahead. Available at:
COP26 Universities Network Briefing. https://assets.publishing.service.gov.uk/government/u
[2] Ali, M. U. et al. (2019) ‘Towards a Smarter Battery ploads/system/uploads/attachment_data/file/873929/ro
Management System for Electric Vehicle ad-traffic-forecasts-2018-document.pdf
Applications: A Critical Review of Lithium-Ion [14] Department for Business, Energy & Industrial
Battery State of Charge Estimation’, Energies Strategy, 2020. ‘Business population estimates for the
(19961073), 12(3), p. 446. doi: 10.3390/en12030446. UK and regions 2020: statistical release (HTML)’
[3] Ambrose EvansPritchard (2020) ‘Why clean hydrogen viewed 1 May 2021, <
can power the drive towards a net-zero world; Big https://www.gov.uk/government/statistics/business-
Finance is sizing up the opportunities that the gas can population-estimates-2020/business-population-
offer with Britain in pole position to benefit’, Daily estimates-for-the-uk-and-regions-2020-statistical-
Telegraph (London, England), 16 July, p. 2. Available release-
at: html#:~:text=Composition%20of%20the%202020%2
https://search.ebscohost.com/login.aspx?direct=true& 0business%20population,-
db=edsgit&AN=edsgit.A629597712&site=eds- The%20UK%20private&text=SMEs%20(small%20an
live&scope=site (Accessed: 10 May 2021). d%20medium%2Dsized,4.6%20million%20had%20n
[4] Banister, D. (2019). ‘The climate crisis and transport’, o%20employees>
Transport Reviews, Volume 39, Issue 5, pp. 565 – [15] Elkington, J. (1998). Cannibals with forks: the triple
568. DOI: 10.1080/01441647.2019.1637113 bottom line of 21st century business. Gabriola Island,
[5] Baker, M. (2004). Definitions of corporate social BC, New Society Publishers.
responsibility - What is CSR?, viewed 1 May 2021, [16] Fu, P., Pudjianto, D. and Strbac, G. (2020)
<https://mallenbaker.net/article/clear- ‘Integration of power-to-gas and low-carbon road
reflection/definitions-of-corporate-social- transport in Great Britain’s future energy system’, IET
responsibility-what-is-csr> Renewable Power Generation (Institution of
©
TechMind Research Society
International Journal of Management Excellence
Volume 17 No.2 August 2021
[34] Vietnam. Ministry of Natural Resources and Electric Vehicles and Hydrogen Fuel Cell Vehicles
Environment. (2016). Environmental protection – Using the GREET Model – A comparative Study’,
urgent issues. Available at: Sustainability 2021, Volume 13, pp. 3 – 13.
https://monre.gov.vn/English/Pages/Environmental- [37] Ziaee Bigdeli, A. et al. (2018) ‘Network positioning
protection-%E2%80%93-urgent-issues.aspx and risk perception in servitization: evidence from the
[35] Vietnam. Ministry of Natural Resources and UK road transport industry’, International Journal of
Environment. (2017). National Environmental status Production Research, 56(6), pp. 2169–2183. DOI:
report 2016 10.1080/00207543.2017.1341063.
[36] Wong, E. Y. C., Ho, D. C. K., So, S., Tsang, C. and
Chan, E. M. H. (2021). ‘Life Cycle Assessment of
©
TechMind Research Society