The decline of diesel prices has been no friend to natural gas-operated Class 8 truck sales in the United States and Canadian retail markets, according to a recent report from ACT Research.
Retail sales of heavy-duty natural gas-fueled trucks started 2015 with slow growth and they wrapped up the year in the same fashion. And, according to ACT’s Natural Gas Quarterly, this continuous decline in diesel prices continues to make the return on investment for adopting of natural gas less lucrative.
“With the fuel price differential continuing to narrow, the ROI to convert from diesel to natural gas is moving in the wrong direction with payback periods lengthening,” said Ken Vieth, ACT’s senior partner and general manager. “However, this doesn’t mean the adoption of NG fuel has stopped or that there are no new developments supporting a future uptick in NG truck orders.”
Vieth said, “Despite sequential momentum slowing, with November NG heavy-duty retail sales down 28 percent month over month and year over year, year-to-date volumes stand just 1 percent below 2014’s levels.”
Saying ACT’s staff continues to closely monitor industry developments,” Vieth added, “We’ve learned that despite the current fuel price differential, NG infrastructure continues to be built, albeit at targeted locations, and that existing NG equipment users remain committed to its long-term viability and emission benefits.”
Additionally, the report provides examples of how equipment research and development efforts are continuing to advance the market. ACT Research sees growth of the adoption of natural gas as a fuel for transportation in the U.S., but doesn’t expect to see double-digit sales expansion on the horizon over the next few years.
ACT has added a quick reference tool for fleets evaluating moving from diesel to natural gas at calc.actresearch.net.