This paper explores the application of Life Cycle Assessment (LCA) in the transportation sector, emphasizing the importance of a comprehensive approach that encompasses all stages of a vehicle’s life cycle and the complexities of energy sources. The methodology of LCA, including goal and scope definition, inventory analysis, impact assessment, and interpretation, is outlined. The paper details the specific challenges and considerations of LCA in the context of vehicle manufacturing, use phase, end-of-life, and diverse energy sources (fossil fuels, electricity, biofuels, and e-fuels). It underscores the influence of geographical, technological, methodological, and policy factors on LCA outcomes. The critical role of industry partnerships in overcoming data silos, enhancing data quality, and fostering collaborative solutions for sustainable transportation is highlighted. The paper concludes by emphasizing the need for continued research, data transparency, and cross-sectoral collaboration to advance sustainable transportation and achieve a holistic understanding of its environmental, social, and economic impacts.