Ok, so I see some serious investment in LNG fueling stations at truck stops. So serious that it's risen above the 'speculative investment' level, IMO.
When manufacturers start rolling out LNG trucks and the fuel pipeline is filled, how will this affect freight rates? Presumably, the only ones that will be able to afford these new trucks in the beginning are going to be the mega-carriers, and they will probably snap them all up as soon as they are available.
Now the L/Os and O/Os are going to be left with trucks and payments on trucks that can't compete in the marketplace due to their fuel expenses being 2 to 3 times that of the LNG fueled trucks. One probably wouldn't be able to GIVE away a diesel fueled truck at that point.
Am I worrying too much? I'm seeing the potential for a major shift in the economics of the trucking industry here.
Are my concerns unfounded? How do you see this playing out?
LNG trucks
Discussion in 'Ask An Owner Operator' started by windsmith, Dec 9, 2012.
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Trust me the government will get their hands in on that and will cost just as much as diesel!!
camaro68 Thanks this. -
LNG is coming, the big question is will it be cost effective . I don't think the LNG or propane has a road use tax on it now. There is no way the government is going to let 10s of thousands of trucks on the road not paying the fuel tax. LNG might be cheaper now but for how long?
It would be interesting to see a cost per mile on a LNG truck. And not a garbage truck that fuels from a landfill with leach gas( or what ever they call that).
Resale on a truck is a joke anyway. I wouldn't lose any sleep.SHC Thanks this. -
The road tax will be adjusted soon enough. What most poeple don't recognize is that LP or LNG holds only 1/3rd the energy of 1 gallon of Diesel. That means that you will have to use up to 3 times as much LP or LNG to go the same distance as a diesel powered truck. Strike while the iron's hot.... but this is why LP and LNG fizzled in the early 90's.
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I have noticed MANY LNG stations along my routes the last few weeks. I was wondering what the benifit was besides not needing to consume crude oil..... kinda makes sense, like the E85 gas craze that went on. i still run it in my pick-up, but only because it burns cleaner and keeps the engine running better with my tuner due to the higher octane rating. But it deff uses a lot more...Last edited: Dec 9, 2012
silenteagle Thanks this. -
What I'm reading now is that the new engines designed specifically to run on NG can convert more of that energy into motion than the previous engines. Many times more efficient - so that negates some of the previous issues. Time will tell, I suppose.
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I think you have a true concern in some ways but LNG isn't going to happen this fast. I have sat on a board doing research on this and yes it is going to happen but it is going to take time. Look how long it has taken to get DEF out on fuel islands, same type of deal with more regulation involved.
It is a great idea and I know 7 small trucking companies here at home (NW WA) that have ordered a single unit already to test the water. I don't see it doing much to freight rates for a long time down the road as the infrastruture just takes too long. Yes some of the larger fleets are going to effect this but you have to accept that rate, if no one will haul for it then they have to increase the price.
Myself I will not purchase one until they can prove to me that they can make it accessable for refueling. Today any fuel stops that you see are private carriers that were part of the testing process. There are other products are out there to help you compete in fuel economy such as the injection system that injects oxygen into your fuel system and causes your old diesel motor to run much more economically, cost is around 5K but you save that in first month if you run much.
Don't let it get you down, there are many things that you can do today to help fuel and bottom line. Just takes research. There is a ton of fed money involved in this push so it is going to happen but not sure yet how hard and fast.
Take care, hope this helps a bit. -
I agree with poppapump1332 the government will surely mess it all up. What you have to remember is that the government is already wanting to regulate fracking. There is a new regulation on fracking coming Jan 1st. So the medling has already begun. Even if you were running LNG why would you take a lower rate. I would still be asking over $2.00 mile. And don't think the big carriers won't be asking the same. Their stockholders aren't invested in the company to give money away. Cheap LNG is just another way to maximize profits. Which is a good thing! Not to be used to lower rates.
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The government collects money on fuel taxes. If you could go out and buy a wonder LNG truck that was much better on fuel, the taxes would follow accordingly. Why do you think the engines Europe uses aren't allowed here at all? They have cars over there getting 70-80 mpg. And the sacrifice in power is comparable to what we have here that gets half that mpg wise. If every vehicle on the road suddenly burned 1/2 the number of gallons, the tax dollars collected would immediately also be cut in 1/2. This is why you need not worry about it, really.
EZX1100 Thanks this. -
maybe on the west coast it is that way, but the ones I have seen are all at Pilot locations and are almost up and running. They just started the install of the fueling stations in the last month, but have about 20 complete so far. I don't think it is a "phase" or a "test" as these places have invested some serious money into the sites. I think it is going to happen MUCH faster than DEF since the sites have already been built. I'm pretty sure they are out of the test phase as some dealers are already selling LNG trucks and there are even a few for sale here in Indiana. All the testing was done on the west coast from what I've read. And there are a few LNG fueling stations in Indy already
i also agree with you that I don't see it effecting rates much.
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