Big Picture: Fisker Karma coming back to dealerships, Tesla financial losses could be offset by “gigafactory”

Fisker plant in DelawareFisker Automotive’s new owner has been shedding more light on where the luxury extended range sports carmaker is headed. Pin Ni, head of Wanxiang America (the US division of Wanxiang Group, China’s largest auto parts company), told Automotive News that the Karma will restart production as early as this year at its Finland plant; the Karma will be sold again in the US and Europe. Production could happen in the US as well, once sales move forward. Ni said there’s a “potential partner out of Michigan.” There’s always the former General Motors plant in Delaware, but Fisker Automotive may stay away from it. Long term, Wanxiang may set up production in China where there’s a lot of government purchase subsidies for cars like the Fisker Karma. Ni also commented on the Fisker Atlantic; Wanxiang wants to complete development of this mid-sized plug-in hybrid. It’s positioned to be more affordable model that is likely to be produced at higher volume than the Karma.

And in other clean transportation news………

  • Tesla Motors sold 22,247 cars last year, pulled in $2 billion in revenue, and took a $74 million loss. This year’s financials could be similar with speeding up production, starting production of the Model X, and expanding globally. Tesla also reported a second set of financial results outside of the generally accepted accounting principles – that one looked much better with a $46 million fourth quarter profit, which was up from $16 million in the third quarter. Tesla CEO Elon Musk also coined another phrase for how Tesla will rise to its challenges – the company may develop a “gigafactory” that would produce lithium batteries for its vehicles at much higher volume and much lower cost. More cash would be needed to do so, and with the company’s stock price so high, now could be a good time to make that investment, Musk said.
  • Check out two reports from the US Department of Energy. “A Guide to the Lessons Learned from the Clean Cities Community Electric Vehicle Readiness Projects” pulls together coverage of 16 different projects around the country. “State of the States: Fuel Cells in America 2013” looks at energy being produced at stationary fuel cell installations, fuel cell forklift deployments, and fuel cell buses, trucks, and cars placed in service.
  • The Kia Soul EV is being equipped with an advanced power pack featuring lithium-ion polymer battery cells supplied by SK Innovation. The battery pack features 192 lithium-ion polymer batter cells in eight modules that can output 27 kWh.
  • Echo Automotive will be adding the Chevrolet Express and GMV Savana full-sized vans to its plug-in hybrid lineup. Production will start in the first quarter of 2015 and will follow conversions of Ford E-Series vans.
  • Paice LLC filed a lawsuit against Ford Motor Co. for alleged patent infringement on its hybrid vehicle technology. The Baltimore company has won a similar case against Toyota Motor Corp. Paice said in its lawsuit that hybrid and plug-in versions of Ford’s C-Max and Fusion, and the Lincoln MKZ, infringe on patents that address ways to control electric motors and gasoline engines for increased fuel efficiency and reduced emissions. The two companies had made a deal in 2010 where Ford licensed one of Paice’s patents. Negotiations haven’t gone well, according to Paice, hence the lawsuit filing.
  • Nissan CEO Carlos Ghosn delivered two Leafs to the Kingdom of Bhutan last week in honor of the king’s birthday. He pledged more EVs to help the government electrify its fleet and the nation’s taxis. Nissan wants to showcase its technology in an unexpected market.

Cadillac ELR and BMW i8 Olympics TV commercials – How good were they?

Cadillace ELR being chargedWhile Super Bowl commercials are infamous for being the most expensive and most watched TV spots in the world, there might be a better media outlet for marketing new cars: the Olympics. While many of the commercials featured Olympic athletes skiing and skating by, there were two that gave a lot of time to luxury extended range electric vehicles: the 2014 Cadillac ELR and the 2015 BMW i8. And they were shown a lot more times than the single viewing you get on the Super Bowl (although the Olympics only happen every four years, or two years if you count the staggered schedule with summer and winter games). As for these Olympic TV commercials, my question would be:  How good were they for marketing the cars?

The Cadillac ELR commercial plays off the competitive edge the US takes to the Olympics, and the upscale lifestyle lived by those driving the ELR – which is in direct competition with Tesla Model S and BMW i Series. “You work hard, create your own luck, and you’ve got to believe anything is possible,” well-recognized TV and movie actor Neal McDonough says as he unplugs his Cadillac ELR and takes off for the office. Americans don’t take the month of August off, like Europeans do, for vacation. “Because we’re crazy, driven, hard-working believers, that’s why.” Those other countries might think Americans are nuts, but we’ve had the Wright Brothers, Bill Gates, Les Paul, and Muhammad Ali – and we landed on the moon first, he says.

While it’s watchable and humorous, it spends very little time onscreen with the plug-in coupe, which is a very lush and impressive car to experience visually and hands on; one would think the car should make up most of the commercial’s focus and not just a few seconds at the end. Yet the commercial is more about style and social commentary than marketing the Cadillac ELR. The production schedule for the ELR is limited and there were only 41 units sold in the US in January; but that’s more than the BMW i Series sold in the US – it’s still very early for the BMW i3 and i8.

I think the BMW commercial gets a little bit closer to hitting the mark. The “Hello Future” ad features a voice over from Arthur C. Clarke’s 1964 BBC presentation. The famous science fiction novelist (with 2001: A Space Odyssey among his books) says, “The only thing we can be sure of about the future is that it will be absolutely fantastic. So, if what I say now seems to you to be very reasonable, then I will have failed completely. Only if what I tell you appears absolutely unbelievable have we any chance of visualizing the future as it really will happen.”

Near the end of the commercial, the BMW i8 appears in the dark and then takes shape, with its raising “butterfly doors” (reminiscent of the upcoming Tesla Model X and its raising “falcon doors”). This car will sell for $136,000 and is supposed to have the same performance as a BMW 335i. So, the audience will be very limited, too. Leasing will be necessary – the price will come down but it’s still very steep. The Cadillac ELR starts at about $75,000 and is more competitive with the Tesla Model S, but it’s also limited in its audience size.

For automakers to turn profits on EVs, it has to be worth the investment and reach a level of scale that makes it competitive with some of their ICE models. These niched luxury extended range cars aren’t going in that direction; they do raise consumer interest in the new alternative powertrain, but they’re too pricy to assist in widespread adoption of EVs. They get federal tax and state incentives, but the price is still very high – even with good lease packages. There’s some public opinion out there that EVs are just a toy for a very small percentage of wealthy Americans, which can get in the way of mainstream acceptance.

Educating and training the electrified transportation workforce

electric vehicle techniciansIt was fascinating to participate last week at “Transportation Electrification Curriculum Roadmap Workshop,” which was organized by Brett Williams and J.R. DeShazo of UCLA Luskin Center for Innovation. It was hosted by Southern California Edison at its SCE Energy Education Center in Irwindale, Calif. The focus of that day was on challenges being faced by education programs training students in community colleges and universities to serve the growing industry of electric vehicles (EVs), electric vehicle supply equipment (EVSE), and charging infrastructure.

I was wearing my consultant hat – it was not a public media event – but I would like to present some of the important information shared that day (identities of participants beyond the two organizers will remain anonymous for now). Much of the insightful information came from instructors and directors at education and training programs on campuses all over Southern California. Along with education professionals, there were people from government agencies, utilities, automakers, fleet management, and research centers. Here’s a few interesting points that were made that day…..

  • Community college and university administrators have been very restrictive about how much funding they’ve been willing to contribute to the education programs. Program directors had to get creative about securing funding, and much of this has come from grant funding outside the school and from corporate contributors.
  • Part of the day was spent analyzing job categories and statistics compiled by Luskin Center based primarily on the US Bureau of Labor Statistics job categories. There’s concern that the job definitions and categories are limited right now – there’s a lot of new and emerging jobs in the US economy that include solar energy and electrified transportation. So the federal and state reports that education programs are using now (and which influence funding) are limited and need to see some change. Educators would like to see the jargon for job classifications standardized in a way making it clear and accessible for everyone.
  • Getting young people engaged in seeking training and education in electrified transportation is a bit of a challenge. The college programs are growing, but educators are wanting to inform communities about their programs – and that would include high school teachers and administrators, students, parents, local government agencies, and others.
  • Program directors are spending as much of their time getting their students jobs and securing funding as they are teaching classes. That’s where creating internships and externships for students is paying off, along with student workshops and research projects.
  • Students are interested in becoming certified service technicians for dealers and fleets; others are getting graduate degrees in engineering to meet the growing demand for advanced vehicle technology integration. There’s also a lot of need for EVSE and charging infrastructure workers to keep EVs on the road.
  • The National Institute for Automotive Service Excellence (ASE) is working on certification for electric and hybrid vehicle technicians. That’s very much needed out there.
  • Another area of interest and training programs is “first responder” safety training for paramedics, firefighters, and others who rescue drivers from EV collisions. As students have asked me about when I’ve done high school presentations, there is a good deal of concern about safety when working with EVs. “Second responders” is also a big group – such as tow truck drivers and storage and wrecking yards. Cars can potentially catch on fire up to a week later, so education and training is needed in this area.
  • Another question:  What to do about electric passenger cars and commercial vehicles (such as bucket trucks and delivery vans) that come off warranty coverage and need regular service?
  • Social media has its advantages in getting the word out to young people and EV enthusiasts. One participant shared that 50% of EV information in social media is being posted on Twitter. Posting photos and videos on social media is getting a lot of hits – with instructors teaching students what they should know about EV technology. Smartphone EV charging apps are also getting a lot of interest.
  • One point that I made at the end (and rambled on a little too long about – my apologies to the group) is that I’d like to see questions that EV buyers ask answered in these programs so that instructors and students can address them. As I learned once again last week in the Green Auto Market reader survey results, there’s a lot of concern among industry stakeholders about how we can effectively answer frequently asked questions that consumers, fleets, and other vehcle buyers have. They want to know if it’s worth their investment of time and money – acquisition costs and incentives, lifecycle ownership costs, and how it all compares to traditional gasoline ICE vehicles; and then there’s always range anxiety. Then there’s the question of the chicken or the egg – what needs to happen to make this all work – more affordable electric vehicles on the market or enough charging stations to alleviate fears of being stranded.
  • This working group on EV workforce training will be meeting again to keep these critical issues moving forward for the next generation of the EV workforce.

Big Picture: New SoCal alt fuel tech center, Fisker Automotive has a new owner

California Energy CommissionThe California Energy Commission has awarded funds to a consortium of Southern California-based organizations led by the Los Angeles County Economic Development Corporation (LAEDC) to establish a Southern California Center for Alternative Fuels and Advanced Vehicle Technology. The Center will consist of one virtual hub and two physical locations—one in San Diego, which will be managed by the California Center for Sustainable Energy, and one in Los Angeles, which will be managed by the Los Angeles Cleantech Incubator. The Center will serve the counties of Imperial, Los Angeles, Orange, Riverside, San Bernardino, San Diego, Santa Barbara and Ventura.

“Our goal with this critically important Center is to also leverage these assets to ensure that we’re a leading developer, designer and producer of these lower-emission technologies to add the high-value jobs and wages as well as the tax revenues that will result from a thriving advanced transportation cluster,” said Bill Allen, President and CEO, LAEDC. The California Center for Sustainable Energy (CCSE), a nonprofit organization that administers the statewide Clean Vehicle Rebate Project for the California Air Resources Board, will operate the San Diego Center. The Los Angeles Center will be managed by the Los Angeles Cleantech Incubator (LACI) at the La Kretz Innovation Campus in downtown Los Angeles.

And in other clean transportation news…….

  • Fisker Automotive has a new owner – Wanxiang:  The assets of bankrupt Fisker Automotive were sold to Wanxiang America for $149.2 million; Hybrid Tech Holdings had opened the bid for $55 million. It took two days and 19 rounds for the acquisition deal to be closed at the Delaware bankruptcy court. Wanxiang’s parent company in China is that country’s largest auto-parts supplier and it also owns A123 Systems, the lithium battery maker that has supplied battery packs to the Fisker Karma. US Bankruptcy Court Judge Kevin Gross chose the public auction route so that unsecured creditors could receive some payback from the deal.
  • Long Beach Clean Cities Coalition, which had been on hiatus for the past year, has now started up again through an alliance with the Municipal Equipment Maintenance Association (MEMA) Southern California chapter. Paul Condran, Fleet Manager for City of Culver City, CA, now serves as president of the board; three of the board members are Long Beach Clean Cities representatives. Bi-monthly MEMA meetings are serving as a main platform for recognizing Clean Cities’ goals and objectives; planning is being done for meetings, seminars, and educational sessions on green technologies, alternative fuels, and carbon footprint reduction methods. MEMA’s next general meeting will be on March 20, 2014 and details will be announced soon – see the chapter’s website for information on this meeting and alternative fuel vehicle educational sessions frequently offered by the organization.
  • US Secretary of State John Kerry mocked those who deny climate change in a speech in Indonesia. He didn’t say one word about the State Department’s and the Obama administration’s decision on the Keystone XL pipeline, which many analysts would say has a lot to do with climate change. Hmmmm………..
  • NAFA’s 2014 Institute & Expo (I&E) will be coming up April 8-11, 2014 in Minneapolis. I&E features over 60 hours of educational sessions, keynote speakers, an expo floor with more than 250 exhibitors, and excellent networking events. I had a great time attending last year, including the NAFA and Calstart workshops on alternative fuel vehicles and advanced technologies. Here’ s the conference’s website for more information and registration.
  • Tesla Motors will have its full-year financial reporting. There’s a slight chance the automaker may announce that day, or sometime soon, or never at all, that Apple may buy the luxury electric car maker. Executives may have had a conversation about it last fall and acquisition may have been discussed; another analyst said that, acquisition or not, Tesla may integrate Apple’s iOS system into Tesla vehicles.
  • ASTM International has issued a standard for dimethyl ether (DME), which could support a major advancement in alternative fuels that’s being developed by Oberon Fuels with Volvo Trucks and Mack. ASTM D7901 for DME provides guidelines for production of the diesel replacement fuel that can made from organic material. It would also apply guidelines to engine developers and for consumers of the fuel.
  • Green Automotive Company announced that its Californian subsidiary Newport Coachworks is planning to launch its 100% electric shuttle bus at the LCT Show in Las Vegas. The fully American built electric shuttle bus, The e-PATRIOT, will be presented for the first time at the upcoming February 16-18th International LCT Show at the MGM Grand Hotel & Casino in Las Vegas.
  • ChargePoint announced the installation of twenty-seven new stations at MGM resorts on the Las Vegas Strip and two new stations at Circus Circus in Reno.

What Green Auto Market readers are most interested in – and what needs to happen for this industry to move forward

reader surveyMany thanks to readers who’ve taken the survey this month. Your responses were insightful and very similar to what I’ve learned from having conversations with stakeholders in the industry, reading media coverage, reviewing survey reports, and reading studies by market analysts. Overall, plug-in electric vehicles, hybrids, hydrogen fuel cell vehicles, and natural gas vehicles (in that order) have the most interest; the charging and fueling infrastructure is right up there, too. It was also rewarding to get feedback on what’s needed in the marketplace for my business, LeSage Consulting,– and to see that it fits in with what stakeholders have been saying to me for a long time about the need out there for effective educational content to address concerns about ownership costs and range anxiety – and if this new industry is making a real difference with environmental issues, governmental policies, and economics.

Educating market segments on the financial side of the question is top priority – acquisition costs and incentives, lifecycle ownership costs, and how it all compares to traditional gasoline ICE vehicles. Availability and accessibility of charging and alternative fueling stations was also high on the list. As for the most important stakeholder groups, consumers finished first, followed by fleets, government agencies, and OEMs (car and truck makers).

There is a lot of interest out there in what’s going on in other industries and technologies and how it will affect automotive and transportation. As for the top five related topics that readers want to stay current on:  next generation batteries for electric vehicles and hybrids; global market conditions for alternative fuel vehicles and clean transportation; regulatory, political, and economic issues affecting alternative fuels and vehicles; futuristic advanced technologies used in fuels such as biofuels and biomass, hydrogen, methanol, dimethyl ether (DME), and renewable natural gas (also known as biogas); and how alternative fuels and energies are being used in other industries such as stationary units, air conditioning, power generation, and industrial applications.

So what’s the tipping point for getting green vehicle shoppers to make that purchase decision? What methods are most effective? Number one: vehicle specifications, pricing, and incentive data; Number two: ride and drives; Number three: answers to frequently asked questions; Number four: video interviews and presentations, and Number five: step by step guides making purchase decisions.

Special thanks to survey respondents who added open-end comments, which you can read below. There is fascination with advanced technologies and where vehicles are heading; creating the charging infrastructure that’s needed for electric vehicles to stride forward; and the source of energy – is that electricity really clean that’s fueling your zero emission vehicle? Here are the results from the reader survey……….

What topics are you most interested in reading about in Green Auto Market?

  1. Plug-in electric vehicles
  2. Hybrids
  3. Hydrogen fuel cell vehicles
  4. Charging and fueling infrastructures
  5. Natural gas vehicles
  6. Vehicle ownership and operating cost savings
  7. Research and development on advanced fuels and technologies
  8. Government regulations and incentives
  9. Vehicle emissions reductions
  10. Fuel-efficient driving and reducing idle time

What issues do you think need to be addressed to gain more interest and purchase activity from vehicle owners?

  • Total cost of ownership – green vehicle versus conventional vehicle  79%
  • Availability and accessibility of charging and alternative fueling stations  71%
  • Lifecycle ownership experience including charging and fueling, maintenance, repair, and remarketing  62.5%
  • Purchase price and incentives  54%
  • Safety of drivers and passengers in green vehicles  29%
  • Manufacturing and fueling the vehicle with energy efficient and environmentally responsible methods 25%
  • Gains alternative fuel vehicles are making in environmental, energy, and economic issues  21%
  • Payment methods for charging and fueling stations  21%
  • Ride and drive opportunities  21%
  • Connectivity with mobile devices  12.5%
  • Other:

  • Education related to how new technologies will be adopted over time. People in general need to put into context the magnitude of the change/transition that comes with moving away from gasoline ICE’s.
  • Long range between refueling events.
  • There are many smaller companies trying to start EV companies; they need access to funding. Only these companies want to bring the price of EV’s down; gas OEM’s don’t want EV’s and are not working on affordable EV’s. HELP!
  • New charging technologies, I read something a couple of months ago about a girl winning a science fair with almost instant charging. Real??
  • Since most electricity comes from coal powered plants how are they positively effecting the environment
  • Workplace charging infrastructure and programs
  • Technology transfer from auto racing use of hybrid and all-electric vehicles

How would you rank these stakeholder groups in importance for shaping the future of alternative fuel vehicles and clean transportation?

  1. Consumers
  2. Fleets
  3. Government agencies
  4. Original equipment manufacturers (car and truck makers)
  5. Transportation providers (such as delivery and trucking)
  6. Corporations
  7. Charging and fueling infrastructure providers
  8. Energy companies
  9. Auto dealers
  10. Environmental groups

What are some of the related topics that you’d be interested in reading about in Green Auto Market?

  • Next generation batteries for electric vehicles and hybrids  87%
  • Global market conditions for alternative fuel vehicles and clean transportation 65%
  • Regulatory, political, and economic issues affecting alternative fuels and vehicles 56.5%
  • Futuristic advanced technologies used in fuels such as biofuels and biomass, hydrogen, methanol, dimethyl ether (DME), and renewable natural gas (also known as biogas)  48%
  • How alternative fuels and energies are being used in other industries such as stationary units, air conditioning, power generation, and industrial applications 48%
  • Renewable energy including solar, wind, and hydro power  43.5%
  • Futuristic advanced technologies used in aerospace, auto racing, bikes, and military vehicles  35%
  • Sustainability campaigns in corporations, non-profit organizations, and government agencies  30.5%
  • Energy efficiency in manufacturing and production, residential and commercial buildings, and other areas 26%
  • Other:

  • Historical context of previous technology transitions (preference to transportation, but doesn’t need to be)
  • Driverless vehicles!!
  • Finding investors for new start-ups. Introducing new startups to your readers? The big auto guys don’t want EV’s and none of them are making money on EV’s. We need innovators like new start-ups that can bring affordable EV’s to the market

What methods do you think would be most effective in promoting support for purchasing decisions and public perception?

  • Vehicle specifications, pricing, and incentive data  65%
  • Ride and drives  52%
  • Answers to frequently asked questions  48%
  • Video interviews and presentations  43.5%
  • Step by step guides making purchase decisions  39%
  • Newsletters and blogs  22%
  • Whitepapers and reports  22%
  • Industry metrics including sales figures and alternative fuel prices  13 %
  • Podcasts and internet radio  13%
  • Other:

  • Actual range performance
  • Vehicle performance, vehicle appearance and comfort
  • Pricing, Pricing and Pricing.
  • Safety
  • Television
  • Carpool stickers

What car shoppers have been asking dealer about their green car owner experience

Utah Car CentsIt was a lot of fun to participate in a radio show on Saturday morning that focused on questions consumers are having about green cars. Special thanks to show co-host Jeff Miller of Mark Miller Subaru for inviting my participation on the Utah Car Cents radio show that broadcasts on Saturday mornings in Salt Lake City. The hosts shared a lot of valuable feedback about what dealers are hearing from car shoppers. Here are few of the points I made during the radio show……

Hybrids – are popular with a lot of people though they’re only about 2.75% of US new vehicles sales – but the Toyota Prius family makes up over 41% of hybrid sales. Subaru is rolling out its 2014 XV Crosstrek Hybrid AWD crossover SUV that gets 33 mpg highway and 25 city.

Tesla Motors is still waiting for the National Highway Traffic Safety Administration to get clear about its Model S recall after four fires that took place last fall. Tesla has re-stated that NHTSA still gives the 2014 model-year Model S a five-star crash-test rating, and reminds everyone that the car remains far safer than the typical gas-powered vehicles. It sales are doing pretty well too, leading the way in January numbers…….

2013 Plug-In EV US Sales
Chevrolet Volt  23,094
Nissan Leaf  22,610
Tesla Model S  18,650
Toyota Prius Plug In  12,088
Ford C-Max Energi  7,154
Ford Fusion Energi  6,089

January 2014 Plug-in EV US Sales
Tesla Model S   1,300
Nissan Leaf   1,252
Chevrolet Volt   918
Toyota Prius Plug In   803
Ford Fusion Energi   533
Ford C-Max Energi   471

As for this year, the BMW i3 and plug-in hybrid crossover i8 are getting a lot of attention, along with the Cadillac ELR extended range luxury car. Fiat 500E is getting interest and rave reviews. The 2014 Mitsubishi Outlander plug-in hybrid crossover SUV coming out.

The general consensus among experienced EV drivers is that a charging station will cost around $600 to $700. Some installation jobs can cost as little as $200; it can run as much as several thousand dollars if a conduit needs to be run from another part of the house, or if new or upgraded electrical service is required at that home.

Federal tax credits are available for $7,500 on qualifying electric vehicles including the Chevy Volt; other plug-in hybrids usually have less of a credit such as Ford Fusion Energi and C-Max Energi at $4,007. Hybrid and diesel credits expired a few years ago.

It’s very popular to lease electric cars these days rather than buy – and it makes up most of the sales transactions now. You can get a three year lease on the $28,000 Leaf for $199 per month in payments after an $1,800 down payment. Chevrolet is advertising a $299 a month lease for 36 months on a 2014 Volt priced at $34,995. That requires $2,499 as a down payment.

The two most popular compressed natural gas vehicles for consumers are the Honda Civic Natural Gas and a version of the Ford F-150 pickup launched last year. There are other CNG vehicles out there including pickups from GM and Chrysler – Ford is the only half-ton CNG (and propane autogas) pickup out there and more suited for personal driving trips than for work in construction and other industries. The Civic varies in price from $18,190 for the traditional version up to $27,965 for the natural gas version. A federal 50 cent per gallon equivalent credit in refueling natural gas expired at the end of 2013, but it’s still being determined how this will affect CNG prices. So far it doesn’t appear to be changing them, which can be about one third the price of diesel. The range estimate is shorter on the CNG version – maybe 225 miles on the natural gas fill up and about 425 miles on a tank of gasoline in the regular version of the Civic. Though customers will pay about $10,000 more to buy the CNG version of the F-150, they could see a payback on their investment in as little as two to three years because natural gas prices are so much cheaper than gasoline or diesel fuel, according to Ford.

Clean Diesel – 2013 sales
Volkswagen Jetta Diesel  43,983
Volkswagen Passat Diesel  34,963
Volkswagen Golf Diesel  7,558
Mercedes GK Class Diesel  6,200
Porsche Cayenne Diesel  5,386
Mercedes ML Class Diesel  4,886

Top selling US clean diesel model:
Chevrolet Cruze Diesel   2,995

The price is higher than gasoline – about $3.31 regular gasoline and $3.94 for diesel on Wednesday. But the mileage is very strong – usually higher than the comparable gasoline engine vehicles, which offsets the gas pump price differential. The technology is becoming more trustworthy as more Americans are changing perceptions of diesel from large, smelly, and sooty commercial trucks to clean, high performance German passenger cars. Turbo direct injection on the VW and Audi models is helping. The Ultra-Low Sulfur Diesel ruling in the fuel pumps has helped, too.

Hydrogen Fuel Cell Vehicles:  That’s been a very popular topic in all types of media in the past few months – consumer, automotive, and business. The Hyundai Tucson Fuel Cell rolled out at the LA Auto Show and is initially being offering in the Los Angeles and Orange County region of Southern California staring this spring for $499 per month on a 36 month lease with $2,999 down. This includes the addition of a remarkable new addition to the Hyundai Assurance program –unlimited free hydrogen refueling. The problem is that there’s only 10 hydrogen fueling station in the US right now, with eight of them in Southern California. Honda has the FCX Clarity fuel cell car in small numbers and will be rolling out its next generation fuel cell car soon. Mercedes has the F-Cell but also on small numbers. Toyota will be rolling out its FCV model fuel cell crossover in the US in 2015. They are amazingly clean – water vapor and zero emissions and you can fuel it up four minutes. But the cost has been high and the volume low; and you have the range anxiety challenge with its lack of refueling stations. 

Big Picture: Don’t forget to take the Green Auto Market reader survey and to join a new LinkedIn group

reader surveyA reminder to take the Green Auto Market reader survey. Electric vehicles and related technologies (such as advanced batteries and renewable energy) are getting a lot of interest from survey respondents. Make sure to put in your word so that all relevant topics and issues are well represented. Click here to take the five-question survey. And check out a LinkedIn group that I started recently – Clean Transportation. There are 20 members so far representing a wide range of interests including the EV charging infrastructure, sustainability, natural gas vehicles, electric scooters, and fleet management.

And in other clean transportation news……

  • IHS Automotive says global production of battery electric vehicles and plug-in hybrids will rise 67% this year versus just 3.6% of all vehicles globally. Tightening European emission standards are part of the trend along with several new EVs rolling out this year such as the BMW i3 and i8, Audi A3 E-Tron, Mercedes-Benz B-Class EV, and Volkswagen E-Up (that won’t be sold in the US). That’s very interesting to read about as IHS is the largest automotive research entity out there now, and has not really been that supportive or interested in alternative fuel vehicles. So that report carries a lot of weight.
  • Tesla Motors was named one of the top five brands in Consumer Reports Perception Survey. Not bad for entering the market in 2008 with the Tesla Roadster, and rolling out the provocative Model S in the summer of 2012.
  • AeroVironment just rolled out what it says is the world’s first dual-voltage charging unit. TurboCord can charge at both 120 and 140 volts.
  • Biofuels may get a break if the president signs the Agricultural Act of 2014, which has passed through both the House and Senate. It’s based on expanding bio-energy production and supports non-food based biomass energy production such as cellulosic ethanol and woody biomass power.
  • Kia is introduced the all-new 2015 Kia Soul EV at the Chicago Auto Show. The Soul is one of three battery-based models Kia is showing at this year’s event; the automaker is also rolling out an updated version of its Optima Hybrid sedan, as well as the new Niro Hybrid Concept.

Light-weighting gaining enthusiasm as channel for reaching fuel economy standards

You may have noticed Ford Motor Co. has been getting a lot of ink lately on its roll 2015 Ford F-150out of the 2015 F-150 pickup made with aluminum body panels, reducing its weight 700 pounds and getting better mileage (up to 30 mpg on the highway). Last week, I spoke with an executive from the engineering consultancy that worked closely with Ford to test and design this next generation pickup. As automakers approach the 54.5 mpg by 2025 fuel economy standard in the US, zero emission vehicles are critical; however, to get past the compliance tipping point, light-weighting is expected to play an even larger role.

David Mason, senior vice president, global automotive at Altair (a global company with its US headquarters in Troy, Mich.), said that the company has been working with automakers for more than 10 years on light-weighting design. Years ago, Altair focused mainly on its computer-based algorithm for simulations such as crash tests. Today, clients are accessing its HyperWorks optimization technology for predictery performance in all categories. Safety is certainly still a priority, but now aerodynamics, noise, and stability, are way up on the list. Fuel economy, environmental concerns, CO2, and CAFE standards are behind most of it. “OEMs are struggling to achieve fuel economy targets,” Mason said.

I asked Mason about the impression I was getting that hardcore pickup truck fans may have concerns about the new F-150 using that much aluminum to transport a lot of gear and passengers. Is it really as tough as Ford brags about in its ads? Mason said that it comes down to finding the “right form for the material located in the right place.” The engineering team had to analyze Ford’s targets for durability, noise, vibration, and crash safety. Adjustments had to be made for the pickup and its payload requirements that are different from a passenger car; the pickup needed more aluminum and stiffness to be able to deliver the payload.  Aluminum is gaining a lot of attention lately as the Ford F-150, the 2013 Range Rover with aluminum structure, and the 2014 Chevrolet Corvette with an aluminum frame, have been grabbing attention.

Altair has created two initiatives to educate interested people on light-weighting and to support light-weight materials’ role in new vehicle design and manufacturing.  The Altair Enlighten Award was kicked off at the Center for Automotive Research (CAR) Management Briefing Seminars last year in Traverse City, Mich. BASF Corp. took the first award for its thermoplastic composite front seat pan used by General Motors. Those interested can fill out the nominee form for the next award that will be presented August 4, 2014, at the next CAR conference. The award was launched to encourage public awareness and to bring recognition and creative competition for light-weighting designers.

Its blog, Enlighten, has become a meeting ground for proponents of product weight reduction to debate which materials will prevail – with aluminum, plastic, titanium, and composites getting a lot of discussion and attention lately, Mason said. “There’s been a lot of focus lately in the media about alternative materials,” he said. “There’s a lot of excitement – will it be aluminum? Titanium? Composites?”

Automakers appreciate that they can reduce vehicle weight and manufacturing costs using optimization technology and substituting with lighter materials. “They don’t have to change assembly tooling or process,” he said. “They’re removing as much material as possible from the existing design approach.”

Global Issue in Fleet Fueling is a Potential “Win-Win” for Heavy Vehicles Sector

Substantial HC Reductions to be Gained in the Capture of “Fugitive Transfer Emissions”

by Chris Hollerback

TCFS powerpoint slideHeavy duty vehicles have seen major transformations in hydrocarbon emission reduction in recent years. This is based on engine manufacturers’ massive investments in new technology and the mandates of Ultra Low Sulfur Diesel, along with SCR/Urea after-treatments. The industry has transformed diesel from the worst pollutant into one of the cleanest and most economic fuels available.

Truck engines and diesel fuel are two of several emissions sources that must be reduced to hit strict, ambitious federal standards to reduce greenhouse gas. So the big question is: “Where will the next significant reduction come from?” It is my belief that considerable gains can be realized through advances in fuel dispensing equipment. “Fugitive Transfer Emissions,” along with vapor purge, happens during the transfer of liquid and compressed gas refueling.

If the goal is to reduce hydrocarbons, wouldn’t it be prudent to capture as much of these emissions as well? With the exception of vapor recovery and on-board refueling vapor recovery (ORVR) in gasoline, this issue is currently “not on the radar” of the US Environmental Protection Agency (EPA). Consider that fugitive loss is a global occurrence and one that can be substantially corrected with significant benefits to the environment, the transportation industry, and the consuming public.

Diesel has secured the environmental future in the EPA’s focus of exhaust emissions.  In spite of these major advances, future reductions of hydrocarbon emissions are still being demanded by the EPA for the heavy duty vehicles market.

The EPA’s focus for hydrocarbon reduction in transportation is currently limited to “exhaust” emissions, which by definition is the measurement of “unburned” fuel. Fugitive transfer emissions (FTEs) are the vapors or purge containing concentrated levels of raw fuel, in suspension, that “vent” in order to displace liquid or compressed gas into a fuel vessel. Venting is a necessary function with all dispensing equipment.

Venting occurs somewhere near the refueling point and always after the fuel meter. The concept of the proposed solution is a common sense plumbing adjustment that effectively moves the vent point back to the supply source capturing vapor, and overfills, in a closed loop. With that said, how significant are these losses, and what gains can be made through total containment?

I am singling out diesel refueling as a starting point to illustrate how significant FTE reduction can be. Diesel refueling raised my awareness of the issue and inspired the proposed solution.

Fifteen years ago I was introduced to the non-public side of fleet transportation through refueling operations at a major metropolitan bus facility. Facility hygiene conditions were, and still remain, appalling.

As an outsider, my first impressions were of how grimy the fuel barn was with puddles of fuel that were obvious slip hazards. Everything was coated with fuel throughout the property. The pungent odor of diesel was inescapable, even in the office areas. My initial questions were “How can people work under these conditions” and “Why isn’t someone doing something to correct it?”

Pressure cleanings were a weekly event with spot cleanings performed daily.  “The nature of the fuel just gets on everything, you get used to it after a while.” This is the one comment that is consistently repeated and sums up the acceptance of the conditions industry wide. So what is the root cause of this rapid recurrence as a need for constant clean-up, and more importantly, can a solution be found to permanently correct it?

From a logistics stand point, the hectic activity to process 500 buses for the next day was fascinating. The buses all come in at once at days end, and stretch around the facility in an endless line.

“Hostlers” drive these vehicles into the fueling area, quickly connect a “high speed” fuel nozzle to a mating connection. Fuel is dispensed at an impressive 40 gallons per minute (GPM). The Hostler jumps back into the bus to sweep out trash and debris. (I still can’t shake the pungent smell of fuel.)

A “whistling” noise pierces the air during fueling; this is a safety indicator that the fuel tank is “pressurized” signaling the fuel nozzle is not to be removed until the whistling stops. This “safety whistle” is cleverly activated by pressure from within the tank, sort of like an industrial tea kettle. This whistle, combined with another pressure relief valve, is designed to dissipate tank pressure and a likely source for aerosol fuel releases. (All fuel tanks must relieve pressure or risk rupture. The trucking industry uses a standard nozzle and an over-sized filler neck that allows venting around the inserted nozzle.)

To confirm the theory in “MacGyver” fashion, I wrapped a handkerchief over the two suspect vent points, producing two oily damp spots. One source of contamination identified, but how significant is the output?

Despite the manufactures warnings, at this location, the fuel hose was repeatedly removed from each bus with the whistle still sounding to get to the next bus. This practice resulted in a back-pressure fuel spill, partially captured by a sludge pit.

As the hostler kicks the fuel door shut with his foot, fuel trails down the side of the bus and is tracked onto the tarmac out to the parking area. This tracking of fuel makes its way to storm drains with wash downs, rain, and snow melt run off.

Two sources of fuel release identified – what’s the volume for each and would there be a significant payback if these conditions could be corrected? The back-pressure spills were the most obvious, so I asked the obvious question “Why would they disconnect before the whistle stops if they know it will result in such a large fuel loss?” The answer was the fuel loss was acceptable as an offset for the extra minutes saved on each bus to reduce labor expense and time.

The fuel “spilled” was less than 1% of total fuel purchased and fuel was not “lost” as it was captured in the sludge pit and sold to “re-processers.”

The calculation for back-pressure spills rounded to .09% equated to 169,000 gallons annually based on this total fleet’s volume. The collected fuel is contaminated and not suitable for reuse and is sold for less than purchase.

Most facilities avoid overfills by properly waiting for tank pressure to dissipate; However, the “atomization” that occurs remains unavoidable due to dispenser design. Overfills, back-pressure spray, and atomized fuel losses all occur after the fuel meter, so for the most part, have gone unnoticed, and more importantly, unaccounted for.

What about the atomized fugitive loss? Is this a big deal? Specific measurement will be calculated with (yet to be determined) university collaboration, but viewed under an infrared camera, the visible “cloud” is significant. A little digging produced a citable reference regarding “fugitive transfer emissions” in an early study of vapor recovery. This was a collaborative effort which included the EPA and American Petroleum Institute (API).

The collaborative calculation states the fugitive transfer loss to be 8.4 lbs of liquid for every 1,000 gallons dispensed. (Conversion is approximate to 1.5 gallons of liquid fuel.)

This specific reference was performed with gasoline which admittedly has very different properties from diesel, but as a liquid transfer, this serves as a reference point for the theory. Gasoline is dispensed at 10 GPM whereas diesel fuel is commonly dispensed at 30 GPM at a travel plaza, and 40 GPM or better, through the pressurized system utilized by 98% of mass transit groups.

The transit group referenced dispenses 18 million gallons of diesel fuel in a year with a total fleet of 1,300 buses. The atomized loss at 1.5 gallons per 1,000 gallons dispensed would equal a 27,000 gallon loss which contaminates the site and places employees at unnecessary occupational risks. This volume in fugitive loss, if captured, would obviously better serve the fleet as usable fuel and provide a cleaner and healthier work environment for the total labor force.

Multiple regulatory programs seek reductions of contamination sources such as: The Air Pollution Act, Water Pollution Act, Spill Prevention, Control and Countermeasure (SPCC), Environmental Justice Act, SmartWays Partnership, Map 21, and OSHA’s Permissible Exposure Limits (PEL) guidelines.

Every commercially available fuel dispenser has a measurable degree of fugitive transfer loss. Diesel fuel does not evaporate as gasoline, but shares some of the same toxins such as benzene. Consequently, vapor recovery has not been required for use in diesel fuel dispensing. Due to the fact that it does not evaporate is reason for capture.

Looking beyond just exhaust emissions will further environmental and health efficiencies. Challenging antiquated dispensing processes provides opportunity to further reduce heavy duty vehicle emissions to improve environmental and occupational health. A closed loop containment dispensing assures that fuel consuming fleets are actually getting all the energy they are purchasing. That’s a “Win-Win” and reasons to consider the change.

Chris Hollerback has a 30 year background in facilities management and process improvement. He is the designer and utility patent holder of the Total Containment Fueling System (TCFS). The patent awards 43 claims of innovations above the state of the art in dispensing. A proof of concept prototype has been developed to validate a solution for fleet application as a logistics tool. Hollberback’s LinkedIn page offers a summary of the TCFS.

Big Picture: Consumers worried about driverless cars, Leaf and Volt sales down

Google driverless carsGovernment officials, DMVs, Google, and automakers (especially Nissan) are much more excited about autonomous, driverless cars than are American consumers. A new study by Harris Poll found that 88% of US adults (18 and older) are nervous about riding around in a driverless car. Some of their concerns focus on equipment in a driverless car failing such as a braking software glitch or failed warning sensor alerting the robot driver about upcoming danger. Nearly 60% are worried about liability issues – primarily who’s responsible for the crash if one were to happen. More than half are worried about hackers taking over the car and playing dangerous games. There’s also concern by 37% of the respondents that personal data will be extracted from the car that could be used against the owner. Another news item from last week about automated cars came from the National Highway Traffic Safety Administration; the agency announced it’s moving forward on V2V (vehicle-to-vehicle) technology as a key to saving lives and improving traffic flow in congested urban areas. It represents the next generation of safety improvements for NHTSA, and eventually will enhance development of autonomous vehicles that automakers want to put on US roads starting in 2020.

And in other clean transportation news…….

  • Nissan Leaf and Chevrolet Volt sales were down in January. At 1,252 units sold, the Leaf was way up over a year ago but down from the 2,529 units sold in December. The Volt saw 918 units sold in January, down from 2,392 units in December and 1,140 from January 2013. January has been a tougher month for sales and bad weather through much of the US hurt sales, too.
  • President Obama voiced support for natural gas vehicles during his State of the Union speech last week. He urged Congress to support construction of natural gas fueling stations for American cars and trucks. It’s part of his “all-of-the-above” energy strategy to create new jobs in America, reduce US dependency on foreign oil, and help curb climate change.
  • AltCar Expo will make its Northern California debut on March 14-15, 2014, at Craneway Pavilion in Richmond, Calif. Similar to AltCar Expo conferences in Santa Monica and Dallas, this one will start with an Industry/Fleet day and then will be followed by a Public Day; ride and drives will be available.  Partners include: Honda, Nissan, California Fuel Cell Partnership, San Francisco Clean Cities, and East Bay Clean Cities.
  • Happy birthday to Green Car Reports, which just celebrated five years and 9,800 articles. According to senior editor John Voelcker, “many people worked long hours for very little reward to tell the stories and spread the word that green cars come in a variety of forms and can be propelled by many different forms of energy.”
  • At the Washington Auto Show last week, US Energy Secretary Ernest Moniz said that nearly $50 million will be available to accelerate research and development of new vehicle technologies. This new funding includes support for the Energy Department’s EV Everywhere Grand Challenge, a broader initiative launched in March 2012 to make plug-in electric vehicles (PEVs) more affordable and convenient to own and drive than today’s gasoline-powered vehicles within the next 10 years.
  • Clean Cities just released its 2014 Vehicle Buyer’s Guidea comprehensive list of 2014 hybrids and vehicles that run on propane, CNG, electricity, E-85, and biodiesel. Like its previous reports, the guide focuses on fuel economy, emissions, information on fuel types, and vehicle pricing.