After an extended period of technological stability, the automotive industry has entered an era of ferment, triggered by regulatory, economic and technological changes. This ferment has also spread to powertrain development in the industry´s most conservative and least researched sector, heavy vehicles. All European heavy truck and bus majors are now experimenting with new powertrain technologies in small series, mostly in buses, and hybrid system suppliers from other industries have also entered the field. In an unprecedented move, Volvo departed from the industry majors´ cautious approach by launching a completely new powertrain platform for the London hybrid bus trial 2010-2012, and making this platform the standard for its future city buses in Europe. Does this signal an end to the industry´s persistent mono-design regime in powertrains? By employing a longitudinal approach, comparing Volvo and its niche-focused competitors both in the development and early market stages, the paper investigates the technology and market challenges involved in this discontinuous innovation, from technology selection and knowledge sourcing to market launch and the struggle to increase volume and reduce costs. The study brings new insights to the criticality of integrated rather than separated or modular approaches when developing technologies for discontinuous innovation in complex products; the need for manufacturers to make use of, but also to escape from idiosyncratic market niches; and the importance of broad competitive entries to seriously challenge dominant designs in this industry.