In response to rising air pollution and congestion, the Hamburg Senate has implemented a €120 million subsidy program targeting last-mile logistics providers. Under this scheme, the city co-funds 60% of the capital acquisition costs for hydrogen-fuel-cell heavy cargo vans and has fully funded the construction of eight high-capacity hydrogen refueling stations across key commercial districts. Last-mile logistics operators transitioning to these hydrogen fleets are exempt from the city's inner-urban road congestion tolls and enjoy significantly reduced maintenance cycles compared to traditional diesel-engine fleets, allowing them to run 24-hour delivery operations continuously with near-zero downtime.
Examine the likely effects on the profitability of last-mile logistics operators in Hamburg of the municipal government's subsidy program for hydrogen freight (Extract C). Use a cost and revenue diagram to support your answer.
