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It’s a Gas, Gas, Gas

WMS Warranty

Over the years we have seen many launches of ‘Alternatively Fuelled’ trucks, but these vehicles have often fallen short of what the market is looking for.

Stralis NP

Iveco can now target the 6×2 tractor unit market with their gas-powered Stralis NP 460. Will this be a game changer?

A combination of lack of infrastructure, range and power plus a hefty price tag has kept the operators away.

At first sight, it looks as though Iveco have a challenge ahead of them with their newest push into the gas-powered truck market.

This time, however, it is clear that they mean business.  The launch of the new Cursor 13 NP spark ignition engine means that at 460HP, the power issue has been overcome.  Iveco UK’s recent 1,700km trip from London to Madrid on one fill demonstrates the range of these trucks.  This just leaves the infrastructure and the price tag.

Operators appear to have been overcoming the infrastructure issues – either by installing their own facilities or refueling at a site on a dedicated route or using a neighboring facility.

The price problem is also going away, as operators are more prepared to consider the total cost of operation, as opposed to the upfront price tag.

Record Sales

As a result of the new Stralis 460 NP (Natural Power) launch, Iveco has sold as many gas-powered tractor units in 2018 as they have diesel versions.  Admittedly this is success from a relatively small base, but this has been achieved without access to a 6×2 option until now.  Remember, 6×2 tractor units make up some 91% of the new truck market so they have been competing with one arm tied behind their backs.

With the Stralis 460 NP now available in 6×2 guise, Iveco are forecasting that 2019 will see half of all their heavy trucks above 18 tonnes powered by gas.  The Iveco plant in Madrid, which manufacturers Iveco’s heavy range, is already producing up to 15% or its output with gas engines.

With Europe-wide sales of just 500 Stralis NP in 2015, Iveco will sell some 3,000 units this year.

Stuart Webster

Stuart Webster: “…one of our competitors has openly stated that
they do not believe gas is the way forward for the 44 tonne 6×2 market that makes up 91% of the UK market – and for that we thank them!
Another can offer 6×2 but only with the addition of diesel and ad blue, adding cost, weight and complexity, as well as emissions!”

Why Gas?

When the whole world is talking about electric vehicles, why has Iveco focused on the gas route?  The simple answer is that battery-powered trucks for medium to long distance transport are not technically or economically viable in the short to medium term.

But isn’t gas a fossil fuel?

Gas can be produced in a variety of ways, but it is essentially the product of rotting vegetation – wither this happened millions of years ago or yesterday should not matter.

The environmental win comes, therefore, when bio methane is used as a fuel.  This is made using an anaerobic digester or animal waste and can be plugged into the national gas grid.

One recent purchaser of a gas Eurocargo – Warrens Group actually makes their own fuel on site to put in the truck as they process food waste.

This renewable gas makes a positive contribution to the environment – anaerobic digestion can greatly reduce the amount of organic matter which might otherwise be destined to be dumped at sea, dumped in landfills, or burnt in incinerators.  If the waste processed in anaerobic digesters were disposed of in a landfill, it would break down naturally and often anaerobically. In this case, the methane gas will eventually escape into the atmosphere. As methane is about 20 times more potent as a greenhouse gas than carbon dioxide, this has significant negative environmental effects.

Burning methane in a truck engine could therefore make a positive contribution to the environment.

CNG vs LNG

These two fuels are the same substance – CNG is methane that has been compressed – meaning you get more energy stored in a tank, whilst LNG goes a stage further and cooling the gas, turning it into a liquid.  CNG stations have compressors that pressurize mains gas, whilst LNG needs to be delivered in the same way operators receive deliveries of wholesale diesel.

LNG Tanks

Twin LNG tanks on the Stralis NP 460 6×2 give a range of around 750kms

Cost Savings

The gas trucks are definitely more expensive to buy. For an LNG version these costs can be around £30,000 for a Stralis NP tractor unit.  This sounds prohibitively expensive, but they come with a saving in fuel cost which means that the payback is under two years for a truck on 180,000 kms a year.

Remember too, that most trucks are purchased on a lease agreement, so the extra paid on the amount of the lease should be more than offset by the fuel savings.

Half of this cost differential is the lack of volume – if Iveco were making as many gas engines as diesel engines, they would be cheaper to make.  The other half is the cost of the LNG tanks.  These are expensive items brought in from the USA.  When volumes dictate these prices should fall as new local entrants enter the market.

The government has guaranteed that the duty differential for gas trucks will continue until at least 2032 – it is 24.7 pence per kilo compared to 57.95 pence per litre of diesel.  This means that gas should continue to generate cost savings against diesel well into the future.

If an operator has to invest in their own refueling infrastructure, this should be factored into the cost analysis, although this investment could be used to generate income by allowing other operators to refuel there.

All Good News?

So gas is cheaper, greener, and increasingly available.  It is also a lot quieter.  As a spark ignition engine, the compression ratio is much lower than a diesel required – it runs more like a petrol – and that means at 71dB that it runs more quietly.

The weight of opinion seems to be moving towards gas as a fuel for medium to long distance heavy trucks.  A ‘Federal Ministry or Transport & Digital Infrastructure’ study identified LNG as the only mass-market alternative to diesel, until hydrogen fuel cell systems come on stream, which it expects around 2030. The German authorities have even cancelled motorway road tolls for gas powered units.

Natural & Bio Gas Vehicle Association and the European Biogas Association expect the market share of natural gas vehicles in Europe to grow to 25% for logistic transport and 33% for public transport, while the LNG vehicle fleet will be multiplied by a factor of 112.

So what are the downsides?  The Cursor 136 NP engine is a 13-litre with an output comparable to an 11-litre diesel – therefore it comes with a 200kg weight penalty.  This is partially offset by the lack of SCR after treatment – the NP has a much more straightforward and lighter catalyst system.

Iveco’s New Approach

Iveco have been trying for years to increase their Stralis tractor unit sales in the UK.  A business can carry on doing more of the same or it can totally change its approach.

Consider this.  Would Tesla have sold as many model S or X cars if they were powered by petrol or diesel?  Unlikely.  The cars themselves are not the desirable in their own right, it is the fueling technology and what it can offer is why the brand-loyal Mercedes, Porsche and BMW buyers were happy to take a chance on the unknown.

A similar comparison could be made with Iveco.  There are many companies that would not even consider Iveco as a shortlist option for a tractor unit now have to consider the Stralis if they want a greener alternative.  Ocado is one example.  Previously loyal to the three pointed star, they will be operating over 30 CNG Stralis NP and have even built their own gas filling station.

Gas trucks are available from Volvo and Scania, giving buyers a shortlist of just three manufacturers.  Iveco feel that this puts them in the driving seat, compared to their competition where one uses diesel in addition to the gas and the other maxes out at 410hp.

Iveco are making their gas trucks a major part of their offering.  It is not hidden in their website, they put them front and centre, pitching them as a realistic choice for operators today.

Only time will tell if Iveco’s strategy will put them firmly on UK fleet buyers’ shopping lists, but one thing is sure, if you keep doing the same thing you will usually get the same results.