BPN: What Do Truck Buyers Want?

As a result of the high cost of replacing bobtails and other vehicles, propane marketers are holding on to their vehicles longer. At the same time, these marketers are experiencing a shortage of drivers and must do what they can to attract and retain those employees.

Benny Gay of Thompson Gas (Frederick, Md.) told BPN that although his company is not experiencing a driver shortage, propane marketers are spending extra money on aluminum decks and other features that help trucks last longer, especially in the colder climates where road salt can damage the truck body. ThompsonGas is also looking into adding automatic tire chain installers that allow the driver to deploy tire chains without having to step outside into the cold. ThompsonGas’ newly acquired Como Oil and Propane had purchased some new bobtails with this feature just prior to the acquisition. That’s one method companies are using to improve driver comfort. “More and more people are buying automatic tire chains,” said Roger Smith of Kurtz Truck Equipment (Marathon, N.Y.). “Flip a switch on the dash, and the chains are engaged.” Gay, meanwhile, is waiting to determine how much value the product brings and how much maintenance is involved. 

But Gay believes those kinds of bells and whistles seem to be a trend. “Companies like ThompsonGas are moving toward full computerization in the cabs.” 

Gay contends that marketers are spending more to run the trucks longer. In the past, he remembers a seven-year lifespan for bobtails being the norm. Now that’s moving to 10-plus, he noted. Marketers are spending the extra money on items such as aluminum decks, believing the investment to keep a truck running a few extra years is a wise investment. 

Availability from F-150 to F-750 and More
The Propane Education & Research Council (PERC) expects continued success in the bobtail and work truck market, not only with Freightliner Custom Chassis Corp. (FCCC) but with Ford in the medium-duty truck area. FCCC offers the S2G propane-fueled bobtail and box truck, and Ford sells the F-650 and F-750 that can run on propane. Recently, the F-150 became a new choice when Westport (Vancouver, B.C.) unveiled a liquid propane system for the vehicle and Impco (Santa Ana, Calif.) introduced a vapor system.
 

“Now we offer the F-150 in propane, and I think that’s going to be a strong seller as well, not only to our industry but also to outside fleets,” said Tucker Perkins, chief business development officer for PERC. “Now a prospective buyer can buy the entire lineup of F-Series trucks on propane.”

Todd Mouw of Roush CleanTech (Livonia, Mich.), whose company offers propane systems for the F-250 through F-750, noted that Ford will build the F-650 and F-750 truck at its Avon Lake, Ohio plant starting with the 2016 model year. Ford previously built the truck in Mexico through a joint venture with Navistar. “It’s a big change for Ford because they have 100% control over the quality of that truck,” stated Mouw, who is vice president of sales and marketing for Roush CleanTech. “Now it’s made and manufactured in the U.S. For the industry, we tout that we’re a domestic fuel. Now it’s a truck built domestically, and jobs are created domestically. Now we can use it for delivery of fuel converted to run on propane, so it’s a great story. It’s a domestically built truck, better quality, and warranted by the manufacturer with Roush’s fuel system using a domestic fuel that obviously the industry knows and loves. So it’s a great story and great trend.”
Mouw added that the trend of fleets offering propane will continue with the announcement from Roush at the Work Truck Show this coming March that “a very large beverage company” will deploy several hundred F-650 delivery trucks.

Roush’s F-750 bobtail, at 33,000 GVW, is in production, and the company will begin shipping vehicles in April. Reaction to the vehicle has been positive, according to Mouw. 

“Additionally, the price point of the Ford chassis plus our fuel system is less than the diesel options they have been choosing from such as [FCCC],” he said. “Couple that with historically low propane prices, the federal tax credit being renewed for 2016, and the marketers’ cost to fuel their propane powered bobtail is less than 30 cents per gallon [wholesale cost minus 36 cents per gallon tax credit for propane]. The propane option is much easier to maintain as well, further increasing the cost per mile savings versus diesel.”

Curtis Donaldson, CEO of CleanFUEL USA (Georgetown, Texas), realized after his company became involved with the Westport F-150 product how much the propane industry and other companies with fleets wanted a half-ton pickup that runs on propane. CleanFUEL USA had been more involved with the three-quarter-ton truck market up to that point. He emphasized, however, that fleets still want the three-quarter-ton product, and his company will continue to provide it. But he admits that energy companies made up a large part of the customers for the three-quarter to one-ton market, and the energy sector is struggling now.

“That market may not be as robust this year unless the energy sector rebounds,” Donaldson noted. “But it’s good to have all three. Invariably you walk in and people use a combination of half and three quarter. Now it’s nice to say we’ve got both.” The passing of the alternative-fuel tax credit36 cents per gallon for 2016in addition to the fact that the medium-duty market uses a large amount of fuel will keep the medium-duty market strong for the propane industry. The light-duty market is a tougher sell at the moment, Donaldson explained, because fleets don’t tend to drive as many miles in them, so the combination of that with lower gasoline prices makes propane for those vehicles a more difficult value proposition for the propane industry to sell.

“I think lot of people are hunkered down, trying to keep everything moving in a positive direction until the differential is higher, but in the meantime I think we’ve still got a good value proposition for higher-mileage fleets,” Donaldson said. “Our focus is just that: Let’s go after the people that still have the economics.”

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