Filed under: 2010 Emissions, IC, International, School Transportation News Magazine
The president of Navistar’s bus and motorcoach arm sits down with STN to discuss how the company is reacting to the economy, new and existing markets.
SCHOOL TRANSPORTATION NEWS: WHAT’S THE LASTEST NEWS FROM IC BUS?
JOHN MCKINNEY: IC Bus had a buy summer making final preparations for the emissions change coming next year. We feel that MaxxForce Advanced EGR will be the preferred emissions solution to our customers. Its simplistic nature, with compliance resting on us, not our customers, will make it the preferred choice for 2010. Additionally, we have several product enhancement programs underway. Our customers will see a new seat frame, new electrical system, and new mirrors from us later in the year, all of which we have made great progress on over the summer. And while we are striving to improve the product experience for our customers, we at the same time are focused on improving the quality of the product coming out of our plants. I feel that when we look back on this summer, IC Bus will have made great strides in improving the long-term satisfaction of our customers.
STN: WHAT ROLE DO IC BUS’ DEALERS PLAY FOR THE COMPANY?
JM: Our dealer network is one of the greatest assets, we think it is the strongest dealer network in the industry. Part of what makes IC Bus who we are in we believe in providing support to our customers from start to finish, having them “covered” if you will. Our IC Bus dealers play that role for us. They are the conduit through which we work with customers, thus vital to our continued success.
STN: HOW IS THE COMPANY DOING FINANCIALLY IN THIS DOWN ECONOMY?
JM: IC Bus is financially sound. As part of a larger organization such as Navistar, we have been able to benefit from an organization that is diversified in its business, not solely relying upon the school bus or truck market. Within IC Bus specifically, our extension into the global commercial bus business has helped us diversify our revenue streams, which in a down school bus market allows us the ability to continue to reinvest into our school bus business.
STN: HOW IS IC BUS LEVERAGING NAVISTAR’S RELATIONSHIPS THROUGHOUT THE MEDIUM- AND HEAVY-DUTY MARKETPLACE (I.E. RECENT ASSET PURCHASE AND FORMATION OF MONACO RV LLC, INTERNATIONAL MOVEMENT WITH MAHINDRA MAHINDRA, ETC.) ECONOMIES OF SCALE?
JM: Through the business and relationships Navistar has in the truck market, IC Bus is able to draw upon these not only to leverage economies of scale with suppliers but also in product development. Our inventory of available components to select from in new product development or processes allows us to more effectively control development costs. For example, take something like a headlight. With our relationships around the world, we can tap into existing componentry, versus developing it from scratch ourselves. This allows us to control costs while still brining a world class school bus to market.
STN: WHAT IS THE CURRENT VIEW FROM IC BUS OF THE STATE OF THE SCHOOL BUS INDUSTRY?
JM: We see the industry being down this year about 20 percent. With the economic downfall, school revenues are down, leading to a decrease of bus purchases. This unfortunately has been added onto an industry that had already been facing pressure. If we look back to before the economic collapse, the industry was shrinking due to revenue short falls, rising fuel prices, and parental indifference to school bus service. This decline, while important to me as an employee for a bus manufacturer, is important as well as I’m a father of school age children. I want them to be able to ride the bus to and from school, which is why groups such as the American School bus Council are so important. We will have a few months left (as of this interview), and the potential for ordering in advance of the emissions change, but the reality is that many school districts stared a new budget year July 1, and it is this fiscal year where they will feel the hit of the economy. While school districts may want to order prior to the emissions change, a lot will not have the money to do so.
STN: DO YOU SEE ANY SPECIFIC TRENDS THAT ARE FUELING YOUR CONFIDENCE FOR THE LONG-TERM STRENGTH OF SCHOOL TRANSPORTATION?
JM: What gives me confidence in the long term strength of the school bus industry is the fact that a lot of people care about it. When visiting with customers, you can see the passion they have for what they do, that they believe in the benefits of the yellow school bus. And knowing that they are supported by great organizations such as NAPT, NASDPTS, NSTA and the American School Bus Council, give me confidence that the school bus industry will not only survive, but grow and prosper.
STN: CAN YOU EXPLAIN/BREAK DOWN THE RECENT $6,000 TO $8,000 PRICE INCREASES FOR YOUR 2010 VEHICLES? HOW MUCH IS TIED TO THE NEW ADVANCED EGR ENGINE AND HOW MUCH IS TIED TO OTHER MATERIALS?
JM: With each emissions change, bus and engine manufacturers have incurred costs to comply with the strict emissions standards set by the EPA. While I can’t break down the cost between engine and vehicle, with stricter emissions controls comes research and development costs to meet the standards. Navistar’s engine group has spent millions of dollars on R&D to be able to develop and hone MaxxForce Advanced EGR. While we understand our customers have a difficult time absorbing any price increase, we fell they will appreciate the benefits.
STN: WHAT IS THE IC BUS VISION OVER THE NEXT SIX MONTHS, YEAR FOR WEATHERING THE CURRENT ECONOMIC CONDITIONS? ARE THERE LONGER RANGE GOALS?
JM: Our plan to weather the economic storm is simple; we have to stay committed to executing on our strategy. First, we have to deliver 2010 EPA compliant engines using MaxxForce Advanced EGR. We are on track, but it is important that we stay focused to ensure we deliver engines and buses that perform as our customers demand. Second, we have to continue to work to control bus costs. Keeping the pressure on now will only benefit our customers when the economy begins to turn around and commodity prices trend upward again. Finally, we need to deliver on the product programs that we have designed to improve our customers’ experience with our buses. New seat frames, new electrical harnesses and mirrors, along with longer ranging programs, designed to improve the operational experience our customers have with our buses.
STN: HOW BIG OF A ROLE DO YOU SEE PRE-BUYS AHEAD OF THE 2010 ENGINE REQUIREMENTS PLAYING INTO PURCHASING DECISIONS THIS YEAR?
JM: We feel the impact of a pre-buy will be small. Many customers would like to, but simply do not have the funding to do so. Some will be the recipients of grants, which will allow them to advance their school bus buys. But the federal dollars to do so were stretched pretty thin. A lot of customers looking for federal assistance with their purchase did not receive funding.
STN: COMMODITY PRICES HAVE BEEN ON A YO-YO FOR THE PAST YEAR. WHAT IS IC BUS DOING IN RESPONSE TO THESE COSTS FROM A MANUFACTURING STANDPOINT? IS THERE ANYTHING IC BUS IS DOING TO HELP ALLEVIATE SOME FINANCIAL STRAIN ON CUSTOMERS?
JM: From the manufacturing side, we are continually looking to control costs. Commonly through improving our manufacturing efficiencies or through supplier selection and negotiation, but also through product enhancement. For example, with our redesigned seat frame, we are able to eliminate about 60 percent of our welds, which will dramatically improve the durability, reducing the back-end costs for both IC Bus and our customers. For our customers on the sales side, we are able to offer budget constrained school districts financing options, which allows them to manage their available budget to get them the buses they need. We have several options available and can work within a number of parameters.
STN: HOW DOES IC VIEW THE RECENT BANKRUPTCIES OF CHRYSLER AND GM AFFECTING ITS BUSINESS, EITHER DIRECTLY OR INDIRECTLY? ITS SUPPLIERS?
JM: The difficulties within the automotive industry do impact school bus OEMs, as we use a lot of the same suppliers. At IC Bus, our purchasing division has been working to ensure our supply base is strong, and in areas where there may be some concern, find new suppliers that can meet our supplier and product standards, as well as help control costs. IC Bus has several hundred suppliers, which with the economic turbulence, we have seen some unable to continue to support us. But as some of the suppliers have dropped off, other, new, stronger, suppliers have taken their place.
STN: RECENTLY, IT WAS ANNOUNCED THAT NAVISTAR WOULD RECEIVE A $39 MILLION FEDERAL GRANT TO COMMERCIALIZE ELECTRIC VEHICLE TRUCK TECHNOLOGY. WHAT IS THE EFFECT OF THIS MONEY ON IC BUS?
JM: The $39 million grant from the Department of Energy will be focused on developing all delivery trucks. While IC Bus may be able to indirectly benefit from the technology development in energy storage and use, the delivery vehicles will be a different class vehicle than used in the school bus industry. I am excited about the opportunity presented for IC Bus through a grant awarded in April 2009 for $10 million to develop the next generation plug in hybrid school bus. Which this grant, we will be able to electrify accessories on the bus and turn the engine off, allowing the school bus to run in an all electric mode for a short time, drastically improving fuel economy and reducing emission output.
STN: THANK YOU.
From School Transportation News Magazine, November 2009 issue.
Navistar showcased an addition to its line-up of International trucks, a vehicle based on an existing American LaFrance low cab-over engine platform, at the recent Waste Expo. Navistar and American LaFrance are developing a joint venture to make LCOE vocational trucks. This show truck was designed to show the waste industry what a potential end-product could look like.
The joint venture will build on the engineering platform of American LaFrance and enhance the product offering with proprietary Navistar components, including Navistar’s MaxxForce Advanced EGR engines to meet 2010 EPA emission requirements.
Marketplace rhetoric has insinuated that the use of credits somehow makes a manufacturer non-compliant. In some isolated conversations, customers have questioned whether the use of credits meets the standard. But the ARB letter inarguably confirms and accepts the approach on which we have been working with the EPA since 2004.
In the attached letter to our parent company, Navistar, Inc., ARB acknowledged that engines that use averaging, banking and trading (ABT) provisions comply with the 2010 emissions requirements. ARB added that engine families both using credits and creating credits are compliant and receive “an Executive Order making them legal for sale.” Furthermore, our 2010 engines are considered Best Available Control Technology requiring no retrofitting and are essentially on equal footing with those at 0.20 g/bhp-hr of NOx.
We think this affirmation by ARB will resolve any doubts about the acceptability of credits for meeting emissions requirements. IC Bus is the only bus manufacturer who can meet 2010 emissions with an in-cylinder solution because we planned ahead for it. We have worked tirelessly to give our customers a solution that takes the burden of 2010 compliance off their shoulders.
We are incredibly confident in our 2010 emissions solution. And thanks to this letter from ARB, we think our customers will be, too.
Click here to view the letter.
Regards,
John McKinney
President, IC Bus
Wow! Is it already August? As I sat down to write this week’s email, I thought it would be an interesting exercise to think ahead to August 2010. What might you be doing this time next year?
As you know, IC Bus and our parent company, Navistar, Inc., will meet 2010 EPA emissions requirements with our customer-friendly solution: MaxxForce® Advanced EGR. With Advanced EGR, emissions reduction takes place within the engine, while urea-based SCR, the competitor’s 2010 solution, uses an after-treatment system.
So, how might next year be different for you as it relates to your buses?
Well, if you only have IC BusTM brand buses in your fleet, next year won’t be much different for you, your drivers or service techs. That’s because our MaxxForce Advanced EGR won’t put the burden of compliance on you. IC Bus has taken on that burden so you don’t have to.
This means your drivers won’t be undergoing new training, since our 2010 EPA emissions solution doesn’t add new warning lights to the driver’s interface. Drivers will simply get in their bus and drive, just like they do now.
Your service technicians will not be taking on new hassles and training, either. Our MaxxForce Advanced EGR engines will have an additional turbo and a larger cooling package, but service technicians are already trained to work on both. Further, since the technology used in Advanced EGR evolved from the same technology used to meet 2007 EPA mandates, diagnostic requirements and service intervals remain the same.
Advanced EGR is less hassle for you, your drivers and your service technicians, because you don’t shoulder the burden. When you weigh your options for meeting 2010 emissions requirements, MaxxForce Advanced EGR from IC Bus is clearly the solution that has you covered.
Regards,
John McKinney
President, IC Bus
Regarding heat, our engineers have worked diligently to ensure that our engines optimally manage the heat of combustion. Our 2010 MaxxForce engines do this better than previous generations. EGR heat is not in the engine – it is in the EGR cooler. In fact, although we are flowing slightly more EGR we are also cooling that flow more so any additional heat is dealt with in the cooling system, which is larger. And, we have upgraded our EGR cooler construction and provided a unique, ultra-efficient coolant flow circuit.
As for soot, which is simply unburned fuel, our other technology advances take care of that. The high-pressure fuel system, twin turbos, piston bowl, and multiple injection events make a more efficient burn; therefore the opportunity to make soot is greatly reduced.
Without question, our MaxxForce Advanced EGR technology takes these things into account so that our current engine life is maintained. After all, if you had to worry about reduced engine life, we couldn’t really call it “advanced,” could we?
Once again, with our 2010 compliant MaxxForce Advanced EGR engines maintaining their current service life, IC Bus continues to take the burden of 2010 compliance off our customer.
Regards,John McKinney
President
IC Bus
Have You Heard?
For most bus customers, fuel economy is a big deal. While IC Bus and our parent company, Navistar, Inc., will meet 2010 EPA emissions requirements with an in-cylinder solution known as MaxxForce® Advanced EGR, our competitors continue to shout about the potential fuel economy advantages of their 2010 solution, SCR.
Have you heard our competitors claim that urea fluid-based SCR will yield a 5% – 9% fuel economy advantage over Advanced EGR? In addition to that, I have even heard a “best in class fuel economy” claim. In a world where fuel economy is top of mind and diesel prices always in flux, I think it is critical to keep in mind that these claims have not been proven or tested.
Not proven or tested? That’s right: the SCR claims of fuel economy advantages over MaxxForce Advanced EGR have not been proven or tested.
How do I know this?
Well, since IC Bus is the only bus manufacturer using an Advanced EGR engine for 2010, we would have had to loan our competitors a MaxxForce Advanced EGR engine for testing this claim. Since we did not do that, it seems this claim is completely unsupported.
Plus, based on SAE fuel economy tests, today’s MaxxForce engines already enjoy a fuel economy advantage (by as much as 12.9%) over competitive engines. So competitors have a lot of ground to make up with their coming 2010 engine designs just to get comparable to the fuel economy of today’s MaxxForce engines.
For argument’s sake, let’s imagine SCR buses do have a fuel economy advantage. Bus owners using fluid-based SCR will still have to consider their total cost of operations increase which will include urea fluid purchase (currently at $4/gallon, Diesel Fuel News, 6/15/09), handling, storage, maintenance, as well as driver and service technician training. All of this hassle should be taken into account when considering any potential (and yet unproven) fuel economy advantage.
IC Bus is providing bus customers a 2010 solution that is customer friendly. No hassles. No new driver or service tech training. And with today’s MaxxForce engine already enjoying a proven fuel economy advantage, no fuel economy worries.
Regards,
John McKinney
President
IC Bus
From Truckers News, June 2009
A letter to the editor from Rob Williams, Gresham, Ore.
I’m a veteran of more than 50 years in the trucking business, with 40 of those years spent as an owner-operator. Since I retired about two years ago, I have been testing the new 2010 Detroit Diesel with this “diesel fluid” tank, as you call it. We call it urea.
Though it is not classified as a hazardous material by the DOT and your source, Mr. Jim Spooner of Colonial Chemicals in New Jersey, says it is safe and inexpensive, you do a disservice to us all by not getting the facts right and taking one source as your proof.
The Material Safety Data Sheet provides the following guidelines for what to do if you come into contact with urea: Move to fresh air if inhaled and provide artificial respiration if needed; wash skin with soap and water, and if there is a rash contact physician right away; flush eyes immediately with water for 15 minutes. If it catches fire, it will burn a strong ammonia smell (carbon dioxide or carbon monoxide) — avoid breathing the fumes. Wear personal protective equipment, wear safety glasses and rubber gloves and use in a well-ventilated area. Toxic inhalation may cause respiratory tract problems, and it can be irritating to the eyes.
I personally had some of this stuff blow out of the plastic tank and onto the hot muffler, and the smell was so bad I began to stop breathing. I had to get out of the truck immediately the odor of ammonia was so strong. When filling the urea tanks if they spill over it must be cleaned up immediately or fluffy white foamy residue will form on the tanks, and you must wear safety glasses, rubber gloves and clothing protection when you fill up these tanks. I know; I have been doing this for two years, and it is not as safe as you want truckers to believe. So with all due respect, get your facts straight and retract what you said in Truckers News, or at least check it out and print a follow-up.
I will be looking for it. Many truckers are going to get sick, hurt or maybe even die if they are not trained on how to use this product. I am trained, and it’s not as easy as you try to make it out to be. It can be very dangerous even though DOT has not classified it as a hazmat product.
SUBJECT: Maker of liquid urea warns of consequences of improper storing or handling
We have been advising our customers that as they consider EGR versus SCR as an emissions strategy for 2010, they should be aware of the many challenges that the liquid urea used in SCR will impose on them.
A new white paper – distributed by the urea industry itself – confirms these challenges.
The attached paper, called “Successful Urea/Diesel Exhaust Fluid Handling, Storage and Dispensing,” was sponsored by a leading maker of liquid urea, a leading distributor and a leading maker of dispensing pumps.
The paper points out the very exacting standards that will be necessary in storing and handling liquid urea, in order to avoid malfunctions and equipment problems.
Here are just some of the white paper’s warnings (italics added):
• “Storage temperatures higher than 86° F will detrimentally affect urea concentration and below 12° F, DEF will begin to crystallize. Both of these circumstances could render the product out of specification and unfit for sale.” (page 7)
• “Product impurities can detrimentally affect the after-treatment systems’ performance and void vehicle warranty guarantees due to premature catalyst deactivation and/or fouling of prefilters and injector nozzles.” (page 5)
• “Injectors are very sensitive, making purity extremely important, as any un-dissolved material may clog filters or injectors. Additionally, dissolved material can result in premature SCR catalyst failure.” (page 6)
• “Premature failure will activate the on-board vehicle diagnostics systems, dramatically reducing vehicle performance.” (page 6)
As you consider which technology will best meet your 2010 needs — Advanced EGR, or liquid urea-based SCR – you need to be aware of all the problems and challenges posed by liquid urea.
Regards,
Mark Johnson
Marketing Communications Manager
Navistar, Inc.
Click on the following to download the White Paper. UREA_HANDLING_White_Paper_060909
IC Bus will meet 2010 EPA emissions requirements for oxides of nitrogen (NOx) with MaxxForce Advanced EGR (Exhaust Gas Recirculation).
As you may know, all on-highway diesel engines sold in the United States and Canada since 2007 use some form of EGR. EGR re-circulates NOx exhaust into the intake stream, where it displaces some of the normal intake. This slows and cools the combustion process, reducing NOx formation. MaxxForce Advanced EGR takes EGR even further, thanks to four unique technological innovations only offered in 2010 MaxxForce engines:
•· Next-generation fuel injection systems deliver fuel into the cylinders multiple times per cycle and at higher pressures. This means combustion takes place over a longer period and is more complete, resulting in creation of lower NOx.
•· Proprietary combustion bowl design combines with the higher fuel injection pressure to break the fuel up into a finer mist that is spread more evenly inside the cylinder. This results in a more complete and cleaner burn.
•· Advanced air management systems place an interstage cooler between dual turbochargers. This reduces air temperature going into the cylinders and allows more air to be packed into the large second-stage turbo for maximum power at high engine speeds. Combining these features with the increased EGR rate means the combustion in the cylinder occurs slower and at a lower temperature, generating less NOx.
•· Electronic calibration, supported by increases in computing power, replaces pre-programmed lookup tables and allows engine controllers to continuously calculate the optimum fuel-air mix for maximum power and efficiency.
The result of these innovations is an engine that treats NOx in-cylinder, and therefore requires no additional aftertreatment – and no extra burden on our customers.
Alternatively, our competitors will add an aftertreatment system based on SCR (Selective Catalytic Reduction) using urea fluid. SCR comes with the complication and cost of a new aftertreatment system and urea fluid maintenance and training.
IC Bus did not want to put the hassle of urea on bus operators’ shoulders. So, by using Advanced EGR, IC Bus takes the burden of compliance off customers with technology advancements that we have been working on for years. Because of these advancements, you can chose an IC Bus with a MaxxForce Advanced EGR engine and avoid dealing with the burdens of urea fluid-based SCR.
Bottom line: IC Bus thought about 2010 emissions so that you wouldn’t have to.
| Regards,John McKinney President IC Bus |
Louisville, KY – Daniel Ustian, CEO of Navistar International Corp., said that he was proud of the industry’s work to reduce diesel engine emissions over the past few years.
Noting that by 2010 nitrogen oxide and particulate matter emissions will have been cut by more than 90% each in less than 15 years, Ustain said the effort has been expensive. He said that Navistar spends about $400 million a year on research and development and that “50% of that is on emissions on the environment.” Ustian spoke at the meeting of the Heavy Duty Manufacturers Association here in March.
Written by Jonathan S. Reiskin in Light & Medium Truck, May 2009
