Improved fuel economy said to be pushing sales of newer tractors
"Operating costs of new equipment are taking steps of improvement, current fuel costs are driving adoption toward new equipment and the reliability of emissions technologies are maturing, Daimler's David Hames said Wednesday at the Commercial Vehicle Outlook Conference in Dallas. (The Trucker: APRILLE HANSON)
By LYNDON FINNEY
The Trucker Staff
DALLAS —There has been a plethora of diesel emission standards heaped on the trucking industry over the years and there’s even a lot of talk in the industry today about how alternative fuels might be the wave of the future.
But the era of the diesel engine is far from dead, so trucking needs to look for ways to continually improve engine performance, four panelists told the opening session of the Commercial Vehicle Outlook Conference here Wednesday.
“(Former Vice President Al) Gore declared war on diesel engines and declared diesel engines would be dead soon,” Dave Williams, vice president, equipment at Phoenix-based Knight Transportation told an audience of over 200. “Well, here we are today and there is no call for ending diesel engines.”
Williams was one of four presenters at a panel discussion on “How regulations and reliability are changing the equipment life/trade cycle.”
Joining Williams were John Diez, senior vice president of Ryder Dedicated; David Hames, general manager of marketing and strategy at Daimler Trucks North America; and Bruce Ewald, senior vice president of sales and marketing, Wabash National.
All agreed on at least one premise: fleets that purchase today’s technologically-advanced tractors and trailers are keeping them longer, and those who don’t adapt and get rid pre-2010 EPA engines are losing ground to fleets that have done so as fuel efficiency continues to improve with each new engine.
“Historically acquisition price and residual value have ruled the day “in terms of life cycle, Williams said in presenting his math equation for purchase of new trucks.
“Acquisition price plus operating costs minus residual value equal total cost of ownership,” he said. “In the life of a truck, we’ll spend a quarter of a million on fuel, twice as much as we’ll spend buying the truck. Yes, we are looking harder at operating costs.”
Fortunately, all the panelists believe that the engines on trucks today are getting 5 percent better fuel economy that those that are four plus years old.
Hames said OEMs and fleets both have their own perspectives when it comes to the purchase and longevity of new trucks.
The OEM perspective is alignment of goals.
Current regulatory direction aligns fuel economy with emissions goals, he said, adding that there had been a creation of “race” to fuel economy leadership.
From a fleet’s perspective, Hames said it’s all about total cost of ownership.
To that end, he said operating costs of equipment were taking steps of improvement, current fuel costs are driving adoption toward new equipment and the reliability of emissions technologies are maturing.
Hames said Daimler has divided emissions and regulatory hurdles into a then and now perspective.
The pre-2010 environment saw significant increases in equipment costs, significant decreases in fuel economy, increased vehicle complexity and decrease reliability, he noted.
And while the post-2010 environment also saw significant increases in equipment costs and increasing vehicle complexity, those aspects were offset by significant improvement in fuel economy and improving reliability, he said.
The industry is hoping for even better results as it prepares for 2017 and 2020 standards.
“We are looking at ‘17 and whatever is coming in 2020,” Hames said, noting that the market leader in U.S. Class 8 sales has changed how it views new standards issued by the Environmental Protection Agency.
“In pre-2010, we were in the very frustrating position of creating products and technology the market didn’t want and technology that cost more,” he said. “Today, we are creating technology that the market wants.”
As for the future, Hames said Daimler was holding discussions today on 2020 engines.
“You have to be way out in front to make sure nothing’s going to be handed us that negatively impacts those engines,” he said.
Price is another reason fleets are holding on to trucks longer, Diez said.
“Acquisition price is going up, maintenance costs are going up and we must operate that piece of equipment longer,” he said, but quickly added that the new technology with greater fuel paybacks might shorten that life cycle as fleets look to buy the latest technology with better fuel efficiency.
The life cycle of tractors in the Ryder fleet has increase each year for quite a while, Diez said.
It wouldn’t be a gathering of trucking stakeholders if someone didn’t take a shot at the current Hours of Service, although the point Williams made stretches back to the 2005 version of the rule that eliminated the split sleeper berth provision in the mid 2000’s.
Elimination of the split sleeper berth has changed the value of an hour, he said.
The value of downtime has changed since the elimination of the provision, Williams said.
“Under the old rule (with the split sleeper berth) if something happened an hour into the day, a driver could stop and get into the sleeper berth while the truck is being fixed,” Williams said. “Now if something happens, there is no stopping (the 14-hour clock). If something happens an hour into the day under the current rule and we have to go to the dealer for seven hours, we’ve lost a day” of productivity.
The panelists also talked about how the tractor of the future was going to have to literally have the comforts and efficiencies of home to attract young drivers.
“The old hard-nosed truck driver of the past is probably not going to be the driver of the future,” he said.
The conference ends Thursday morning.
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