NG Class 8 truck sales bounce up in North America

Natural gas Class 8 truck retail sales in the US and Canada improved in May, after getting off to a slow start earlier in the year, according to a recent report from ACT Research.

This is attributed to a high number of natural gas (NG) vehicle repeat sales, as well as purchases by transit bus and refuse truck operators. But will it continue for the rest of the year?

However, the continuing low cost of diesel is making the return on investment (ROI) for adopting natural gas less lucrative for fleets not yet invested in NG-fuelled vehicles.

“With the fuel price differential continuing to narrow, the ROI to convert from diesel to natural gas is moving in the wrong direction: payback periods remain lengthy,” notes Ken Vieth, ACT’s senior partner. He continued,

“This doesn’t mean the adoption of NG fuel has stopped or that there are no new developments supporting a future uptick in NG truck orders.” Vieth adds, “Even so, despite a 48 per cent month-on-month uptick in May, year-to-date volumes are 24 per cent below 2015’s level and year-over-year sales are down 21 per cent.

According to Vieth, NG infrastructure continues to be built, albeit at targeted locations and at a slowing pace. Existing NG equipment users remain committed to its long-term viability and emission benefits, he adds optimistically.

Although there are examples of how equipment research and development efforts continue to advance the market, ACT sees only modest, single-digit growth for NG adoption as a transportation fuel in the US over the next few years.

It is worth noting that the only truck engines currently available in the US able to meet proposed GHG and NOx proposals, are NG engines, namely the spark-ignited 8.9- and 11.9-litre Cummins-Westport ISL and ISX natural gas units.

Considerably more expensive to purchase than the diesel engines from which they are derived, there is also concern about NG engines’ higher maintenance costs. So the NG powertrain not only faces higher fuel costs, but higher first-cost and higher lifetime costs.

Even so, two Californian air quality monitoring groups in a collective petition to the US Environmental Protection Agency (EPA) are pushing for the federal NOx emission limit of 0.2gm per bhp-h for heavy-duty commercial vehicles, in force since January 2010, to be reduced by no less than 90 per cent to a near-extreme level of only 0.02gm.  

What is worse, from truck diesel engine manufacturers’ viewpoints, is their request of a proposal embracing the 0.02gm limit be in place by mid-2017 followed a final ruling by 31 December 31 2017, with the EPA mandate taking effect in January 2022.

If these California-based ideas are taken on board it would seem they could play into the hands of those companies building NG engines and associated equipment, stymying diesel engine growth.

On the other hand, the relatively meagre network of NG refuelling points across the US and Canada would indeed struggle to support the surge in NG vehicle numbers that would be spurred on by the format of any new EPA emissions proposals.

For their part, diesel engine makers are likely to pitch in with the quip that a call for such stringent legislation within just a four-year timeframe is ‘unrealistic’ to say the least.

It will be interesting to see exactly what those new January 2022 ‘regs’ turn out to be in reality – and to see if the four-year moratorium is stretched further to appease diesel engine makers.