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Increasingly stringent CO2-regulations demand a reorientation of powertrain concepts in the transport sector. As an example, by 2025 in Europe, CO2 emissions must be reduced by 15 % and by 2030 by 30 % compared to the 2019 baseline. In the long-term, the focus is also on completely CO2-neutral powertrain development as aimed for by global GHG regulations.This publication focuses on the development of CO2 neutral powertrains with internal combustion engines considering several aspects like fuels (especially hydrogen), powertrain concepts, development methods, and upcoming legislations. Based on the requirements for the development (e.g. CO2-neutrality, TCO, pollutant emissions), it is described how the development targets can be derived with a holistic approach. This can then be tailored to the specific fleet composition of an individual OEM.To convert a conventional diesel fueled heavy duty engine to CO2-neutral operation, key components like combustion system layout, turbocharger, injection and ignition system as well as the controls software structure and the exhaust gas after-treatment system must be redesigned. Several simulations tools and experimental work are combined to identify preferred technical solutions based on specific applications. It will be demonstrated how this process enables an efficient development towards the future powertrain of heavy-duty transportation.