Cummins to Use Credits to Meet 2010 Standards

This story appears in the March 29 print edition of Transport Topics.

LOUISVILLE, Ky. — Cummins Inc., the only remaining independent truck engine builder, said last week that it will use federal emissions credits to meet new government pollution standards with its 2010 models.

Although Cummins officials have not publicly discussed their intention to use U.S. Environmental Protection Agency credits, they said using credits earned in past years has long been a company plan for its heavy and midrange engines.

“Because we have a complete product line, we were able to produce engines beginning in 2007 that already met the 2010 emissions standards,” said Ed Pence, vice president and general manager of the company’s heavy-duty engine business.

Exceeding federal standards allowed the company to accumulate credits from EPA that it will spend now, as it improves the fuel efficiency of its 2010 models at the expense of some additional emissions.

Pence said Cummins will use EPA credits to introduce all its heavy and mid-range engines, with the exception of the new 2010 ISX11.9-liter model, at 0.2 gram to 0.5 gram levels to comply with federal emissions standards.

Pence was interviewed here last week during the Mid-America Trucking Show.

“We’ve got a range there of where we hit that sweet spot to deliver maximum fuel economy, maximum greenhouse gas benefits — an overall benefit for the environment and our customers and performance advantages,” Pence said.

“What we’ve done . . . is selectively apply our credits to maximize the fuel-economy, greenhouse gas benefits associated with tuning the engine at a NOx level between either 0.5 gram, the maximum level you can offer, versus a 0.2 gram,” Pence said.

He said the ISX11.9, which will be launched in the third quarter, will meet the EPA standard of 0.2 grams of NOx.

During MATS, both outgoing Cummins President Jim Kelly and successor Rich Freeland said the company is counting on its long-range strategy to maintain its strong market share by concentrating on delivering better fuel economy in 2010 and beyond.

Kelly said the company was firmly banking on selective catalytic reduction technology for the future, and its 2010 heavy-duty engines, which were certified by EPA earlier this month, already have been extensively field-tested for reliability.

Cummins officials said its new engines are expected to improve fuel economy by as much as 5%.

“We’re ready for 2010,” Kelly said.

Despite a tough economy, he said, Cummins invested $175 million in developing its engines last year.

Kelly added that he expected the economy would be slow to recover, and the company would not likely “meet or exceed” its 2008 revenues until 2012.

“We’re right around 50% market share for heavy-duty, Class 8,” said Carol Lavengood, director of marketing for Cummins, based in Columbus, Ind.

Cummins originally had planned to use exhaust gas recirculation technology to meet 2010 EPA standards, but later switched to SCR.

Lavengood told Transport Topics, “What really drove us toward SCR with our heavy-duty product was a step change in some catalyst technology, which our engineering team saw would give us significantly better fuel economy than we originally expected.”

It was after that discovery Cummins abandoned EGR technology and parted ways with Navistar Inc., she said. “We decided it was the right thing to do, to change course.”

Navistar, a large Cummins customer, is using EGR in its engines and had planned to offer Cummins EGR engines as options

for customers. After Cummins switched to SCR, Navistar cut relations with the company.

“We believe what our buyers look for is total operating cost advantage, and fuel is a huge piece of that, as is reliability,” Lavengood said. “Fuel economy is typically the number one or two cost for fleets. Our future product development is all focused around fuel economy,” Lavengood said.

The competition between EGR and SCR manufacturers continued to be a hot topic here at MATS last week.

“We haven’t really said publicly how long we intend to use these credits, but certainly it’s our intention to offer these benefits as long as possible for several years,” Pence said.