DETROIT (Bloomberg) -- As Sergio Marchionne brings back Fiat SpA to the U. S. after nearly three decades, he may add another Italian speciality: the natural gas engine.
Marchionne, who is CEO of Fiat and Chrysler Group LLC, says natural gas
engines offer a better way to cut emissions because they?re cheaper than
competing technologies. He also argues electric cars, which General Motors
Co. and Toyota Motor Corp. are betting on, present ?too many obstacles? such
as the recharge time for batteries.
?Natural gas is very suitable for the U. S. , ? Constantinos Vafidis, who
oversees transmission and hybrid development at Fiat?s research center in
Turin, Italy, said in an interview. ?Especially for public services and
goods transportation, where vehicles are refueled from a central base. ?
Fiat is the market leader in Europe in natural-gas engines, with an 80
percent share of methane-powered cars and 55 percent of light commercial
vehicles. Bolstering Marchionne?s view, the U. S. has the natural-gas supply
for the engines after becoming the world?s largest producer last year.
?Fiat will use its technological leadership in natural gas, in a region
discovered to have huge reserves, ? said Giuliano Noci, a professor at the
MIP management school of Milan?s Polytechnic university. ?It?s almost a
mandatory strategy. Fiat should lead the natural-gas car market as it?s far
behind in the electric vehicle sector. ?
'More affordable solution'
Natural gas is a ?more affordable solution? as it?s less expensive to
produce, transport and distribute compared with other fuel sources, Alfredo
Altavilla, who heads Fiat?s Iveco truck unit, said in September. The
additional cost for an engine using natural gas is $3, 000, compared with
$3, 300 for diesel and $8, 000 for an electric hybrid, he said.
Fiat sold 127, 000 methane-powered cars in Europe last year, including
versions of the Panda compact and Ducato van, helped by government
incentives. The U. S. last year overtook Russia as the world?s largest
producer of natural gas, as output of gas trapped in shale rock rose to 10
percent of total U. S. supplies from 2 percent in 1990.
?We?ve had contact with the U. S. and Canadian governments, ? said Lucio
Bernard, director of Fiat Powertrain. The two countries have become more
interested ?after the recent discoveries of shale-gas reserves in the
While Italy?s natural-gas vehicle market is one of the most robust in the
world, with more than 800 fueling stations across the country, the market is
still in its infancy in the U. S. GM just began selling vehicles with
natural-gas engines in the country this year for fleet buyers. Honda Motor
Co. is currently the only automaker selling cars with compressed natural gas
engines to retail customers in the U. S.
Fiat and Chrysler, which is joining the natural-gas vehicles association in
Washington, are currently studying whether to sell natural-gas vehicles in
the U. S. , the two carmakers said. Fiat will re-enter the U. S. next year,
targets sales of 50, 000 of the 500 compact in the market.
?We?re always looking at alternative propulsion systems and how to reduce
our dependency on foreign oil, so this is one thing we are looking at, ?
Chrysler spokesman Vince Muniga said.
GM and Toyota are focusing on hybrid electric vehicles as their alternative
to conventional gasoline engines. Detroit- based GM started production of
the $41, 000 gasoline-electric Chevrolet Volt Nov. 30 and forecasts sales of
10, 000 of the cars next year and 45, 000 in 2012.
Toyota is the maker of the world?s first mass-produced hybrid car, the
Prius, which went on sale more than a decade ago. Chrysler is also
developing an electric version of the Fiat 500 to begin selling in the U. S.
in 2012 for city driving.
While recharging stations for electric-car batteries present an
infrastructure challenge, locations for refueling natural gas vehicles are
also limited. There are 1, 300 stations in the U. S. for the 110, 000
using natural gas, the International Association for Natural Gas Vehicles
said. That compares with 160, 000 gasoline stations, the Petroleum Marketers
Association of America said.
The lack of methane fueling stations in the U. S. has limited these vehicles
primarily to government and corporate fleets that can return to a central
location to refill.
"That is where the industry is primarily putting its emphasis right now, ?
said Richard Kolodziej, president of Natural Gas Vehicles for America.
Natural gas is about $1 less on average than a gallon of gasoline, he said.
Marchionne, who plans to raise Fiat's Chrysler stake to 35 percent by the
end of 2011 from 20 percent, last year separated the Ram and Dodge brands to
create a standalone truck unit. His five-year plan for Chrysler includes
bringing large- and small-commercial vans to the U. S. in 2012 under the Ram
brand based on Fiat?s trucks platforms.
?That gives them the freedom to introduce Iveco products into the Chrysler
lineup, ? said Phil Gott, an IHS Automotive analyst in Lexington, Mass. ?The
target customer would be the heavy duty fleets, they could cut their fuel
costs in about half, ? he said of natural gas engines.
The U. S. currently ranks 14th in the world in sales of natural gas
while Italy is sixth, according to the International Association for Natural
Gas Vehicles. Pakistan ranks No. 1 with 2. 3 million vehicles and 3, 068
fueling stations. Marchionne hopes to boost the U. S. figure.
?Fiat?s technological leadership in compressed natural gas in Europe is a
key asset for the U. S. natural gas-vehicle market, ? the CEO said last
- posted 9 years ago