Sales of natural gas-powered Class 8 trucks and buses continue, but at a slower pace than last year, as well as when calculated as a percentage of the total market, according to a new report from ACT Research.
Not at all surprising, the Natural Gas Quarterly attributes the rapidly declining cost of diesel fuel with making the return on investment for adoption of natural gas less lucrative.
“With the fuel price differential narrowing, the ROI to convert from diesel to natural gas is moving in the wrong direction: payback periods are 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 that might lead to a future uptick in NG truck orders.”
Vieth explained that ACT’s staff has spoken with a variety of industry participants. He said, “We’ve learned that despite the current fuel price differential, NG infrastructure continues to be built — albeit at targeted locations — and that previous NG equipment purchasers remain committed to the alternative fuel, seeing it as a long-term prospect, not just a short-term reaction to historically high, volatile diesel prices.”
Additionally, the report provides examples of how equipment research and development efforts, as well as financing partnership opportunities, are continuing to advance the market. ACT Research sees growth for the adoption of natural gas as a fuel for HD vehicles in the U.S., but doesn’t expect to see double-digit sales expansion on the horizon in the next few years.
The Natural Gas Quarterly provides information on the current status of multiple factors that impact a decision to adopt natural gas. Included is a “dashboard gauge” that looks at the fuel price spread, public heavy duty NG fueling infrastructure, NG equipment, and the quantity of NG heavy-duty truck sales. ACT has added a quick reference tool for fleets evaluating a switch from diesel to natural gas to its free, online NG Fuel Payback Calculators at calc.actresearch.net.