Cleaner road ahead
Like many government fleet managers, the more Erle Potter hears about the changes to the 2007 model trucks, the less he likes them. With the next stage of federal mandates to reduce pollution from diesel truck engines expected to affect price and performance, he is concerned with the increased cost for next year’s vehicles and additional maintenance.
Potter is the Virginia Department of Transportation’s assistant equipment management director for the Asset Management Division. Because he is in charge of all the department’s trucks, Potter also worries about higher prices for ultra-low sulfur diesel (ULSD) fuel, which must be used beginning in October. The new, more emissions-friendly engines will require reformulated motor oils, as well. “We’re hearing that not only will the new engine oil be more expensive, we may have to reduce our drain intervals — that leads to more downtime and more cost to us,” Potter says. “Because the new oil is more costly, we may go to using two different engines oils, which requires additional inventory costs.”
The Washington-based Environmental Protection Agency (EPA) has targeted diesel-powered trucks as a problem polluter for several years. While they make up only 2 percent of vehicles in the nation, diesel trucks produce exhaust that is responsible for more than 60 percent of all particulates and nearly half of all nitrogen oxides, according to EPA.
EPA’s emission standards include nitrogen oxide (NOx) and particulate matter (PM), and levels of both are being reduced in three phases, the first in 2002, followed by 2007 and the last in 2010, when the NOx and PM will be almost nonexistent in the exhaust stream of medium- and heavy-duty trucks. To meet the requirements, truck engines are being re-engineered, and diesel fuel and oil are being reformulated — changes that will increase costs for every fleet department.
Four engine changes
The 2007 emissions requirements affect truck engine designs in four areas, says Richard Thompson, group president responsible for Peoria, Ill.-based Caterpillar’s truck engine division. First, to meet EPA’s requirement to reduce PM ten-fold, manufacturers will need to add a diesel particulate filter. Second, because crankcase emissions now are regulated as exhaust emissions, they must be filtered.
Third, the engine’s emissions system performance must be monitored, with most manufacturers using engine manufacturer diagnostics to detect problems within the emissions control system. Finally, the 2007 standards have established a useful life for emission control systems: 435,000 miles for heavy-duty trucks and transit buses, and 185,000 miles for mid-range diesel trucks.
To meet the third leg of the emission control regulations by 2010, engine and truck makers — along with their component suppliers — will have invested $7 billion to reduce exhaust pollution, says Dee Kapur, truck group president for Chicago-based International Truck and Engine. That investment should result in $150 billion worth of health-related savings, according to EPA.
Sticker prices
The increased purchase price for 2007 trucks will have the biggest effect on fleet managers. To date, only International has released information on how much its new truck prices are going to rise, however, most other manufacturers likely will stay near or below those estimates to stay relatively competitive.
Kapur estimates that International mid-range diesel powered trucks and school buses built by its subsidiary, IC, will cost $5,000 to $6,000 more per vehicle, and between $7,000 to $10,000 more for Class 8 truck/tractors with supplier engines. “Also, additional charges will apply to certain engines where higher horsepower requires dual after treatment,” Kapur says.
To defray some of the extra cost, truck manufacturers and the American Trucking Associations (ATA), are trying to secure tax breaks for fleets that buy 2007 trucks. “The ATA is engaged in discussions with a number of elected officials to give customers a 5 percent tax credit on Class 8 trucks containing the new engines,” says Patrick Charbonneau, International’s vice president of government relations.
Higher prices might cause fleet managers to wait before they buy the new models, but delaying truck purchases may mean increased maintenance costs for older units, says David McKenna, powertrain product manager for Allentown, Pa.-based Mack Trucks. “Short of the capitalized cost increase, I see no reason to change the traditional purchasing program or fleet update strategy,” he says. “Muni’s are becoming more of a commercial-type enterprise recently with regard to the expenses and capital outlays, always under the watchful eye of activist tax payers and oversight groups.”
McKenna says he knows of municipal business plans that specify an eight-year replacement cycle for heavy truck equipment. “I can guarantee today that there are many fleet managers operating equipment that is already at 110 percent to 120 percent of such a plan’s life,” he says. “With the added expense of maintaining much older trucks and the advantage of newer cleaner engines, it may not be the best plan to postpone new equipment.”
Engine and fuel problems
Fleet managers also are concerned about decreased performance from the new ULSD fuel — fuel with a sulfur content of 15 parts per million (ppm) versus the 500 ppm fuel in use today. Using ULSD fuel is not an option, however, because it must be used to make the low-emission technology on 2007 trucks work properly. “We need ULSD fuel because high levels of sulfur can clog up and poison the diesel particulate filters (DPFs) used to clean the exhaust stream,” says Josh LePage, International’s vocational marketing manager.
By October, 80 percent of all the on-road diesel fuel produced in the United States will be ULSD, with only 20 percent reserved for 500-ppm fuel. By 2010, all diesel fuel must be 15-ppm grade.
However, ULSD could add between 5 cents and 13 cents to the cost of producing and distributing on-road diesel fuel, says Bill Graves, ATA’s president and CEO. That is coming on the heels of two record years of diesel fuel price jolts.
ULSD’s composition also is an issue, because it may slightly lower the fuel economy versus today’s diesel, says Mike Ingham, manager of state fuels regulations for ChevronTexaco. “The severe processing required to remove sulfur results in a fuel that has a lower energy content compared to the higher sulfur fuel,” he says. “As a result, fleets could see a fuel economy penalty of 1 percent to 2 percent because of the [ULSD]. However, for fleets that have older equipment, in switching to ULSD, they may notice only a slight fuel economy penalty.”
That loss gets added to the fuel economy reductions from emission control technology — both from engine and emission aftertreatment system changes. For example, Kapur says that based on current tests of International engines, fuel economy degradation currently is estimated to be beyond 1 percent, mainly because of using ULSD.
McKenna notes that fuel economy losses are not necessarily a given for 2007 engines, saying it depends on the type of engine and truck application. In fact, he claims Mack’s newly designed engines will provide “improved fuel consumption overall.” Other engine manufacturers, such as Detroit Diesel and Caterpillar, also are updating their 2007 engines with a number of changes to address performance, maintenance and fuel issues.
Big changes are occurring to engine oil so it can protect both 2007 engines as well as their exhaust systems, according to Dan Arcy, technical expert for Houston-based Shell Oil. “Many of the new engines are going to contain DPFs and oxidation catalysts in the exhaust system, so the new formulation of engine oil we need will be low in sulfated ash, phosphorous and sulfur,” he says.
The new chemical engine oil limits could cause a reduction in the drain interval, however, “as the sulfur content of diesel fuel is dropping down to 15 parts per million, things should even out, so the drain interval should likely remain the same,” Arcy says. He also expects engine oil prices to rise, but not much. “It is logical that the cost of development in addition to higher component cost will result in higher product costs, but likely not doubling the price,” he says. He also stresses that the 2007 engines are going to produce up to 20 percent to 30 percent more heat, which may require using extended-life coolants.
Training needed
Truck manufacturers have begun educating technicians and managers about the 2007 truck technology changes. LePage says his company is not only educating dealers so they can work with customers but is collaborating with other manufacturers to give joint presentations at industry meetings. Mack, too, will be conducting customer clinics throughout the United States and Canada with its distributors to discuss details about the company’s strategy for meeting the 2007 standards, says Paul Vikner, Mack’s president and CEO. LePage says that once fleet managers understand what is going to change in 2007 — and what will not — they will be less worried about the effect on their operating costs.
“The only thing we’re really encouraging municipal fleet managers to do is to start writing into their contracts increases to cover the higher costs of the emission control technology for 2007,” LePage says. “The general comment I get from fleet managers after I give my overview is, ‘Wow, these changes aren’t producing the horror show I expected.’ Once you get a good look at the 2007 changes, it should relieve a lot of the concern.”
Sean Kilcarr is senior editor at American City & County’s sister publication, Fleet Owner.
How trucks will change
Fleet managers will see the effects of the new exhaust emission limits in:
- Sticker prices
The costs of medium-duty trucks and school buses are expected to increase by $5,000 to $6,000, with heavy-duty trucks getting a $7,000 to $10,000 boost. That covers the cost of more expensive low-emission engines and after-treatment systems that include pricey diesel particulate filters (DPFs), costing about $3,000.
- Fuel
In October, 80 percent of all on-road diesel fuel sold in the United States must be ultra-low sulfur diesel (ULSD) with a sulfur content of 15 parts per million (ppm). Expect to pay between five and 13 cents more per gallon for ULSD. Also expect fuel economy to drop 1 percent to 2 percent as less sulfur translates into lower energy content.
- Engine oil
A new oil formulation — tentatively entitled CJ-4 — is required for 2007 engines, increasing the cost for oil 10 percent to 20 percent. Also, the higher heat produced by the engines will require more oil changes per truck per year.
- Coolant
As 2007 engines generate up to 30 percent more heat to help reduce exhaust pollution, they will need greater amounts of coolant — and more robust formulations. While the price of engine coolant probably will not change, fleet managers will need to buy more of it.
- Maintenance
Detroit Diesel expects fleets may pay up to $367 extra per year per vehicle in maintenance costs overall, including the extra shop time needed to check emission-related components and make extra oil changes.
