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Ford Taking America’s Best-Selling Truck All ‘Natural’

Filed by KOSU News in Business.
July 31, 2013

The reigning king in the truck world is the Ford F-150, and it’s been that way for a couple of decades. But staying on top is getting harder.

With new, tougher fuel standards looming there is a lot of emphasis on efficiency and innovation. On Wednesday, Ford is announcing its flagship truck is taking a step into the alternative fuel world with a vehicle that can run on natural gas.

When you look at their bottom lines and their advertising you realize that the Detroit Three make cars, but they’re really truck companies, especially Ford.

“Well I think the F-150 pickup truck is probably the single most important vehicle to Ford Motor Company and arguably it might be the single most important vehicle period,” says Jack Nerad, an analyst with Kelley Blue Book. “It’s just an 800-pound gorilla in the marketplace.”

Nerad says when Ford takes a step there is a potential that the rest of the truck world will follow. Ford is making compressed natural gas an option on the truck that is its best selling vehicle.

Compressed Natural Gas, or CNG, is cheaper than petroleum, it emits less carbon dioxide and the U.S. has a whole lot of it.

Advocates for natural gas say this is a big step toward using more of it. John Hoffmeister used to be CEO of Shell, the oil giant. He now runs a group called Citizens for Affordable Energy.

“The fact that Ford would begin to put CNG into a very popular consumer vehicle … is a major step along the way to a transformation of the total fleet of American vehicles,” Hoffmeister says.

The F-150 will run on both CNG and regular gas, but it won’t be cheap. The CNG option runs upwards of $7,000.

Nerad doesn’t think there’s a huge consumer market, but he says large companies and city and county governments will be interested.

“A lot of these vehicles are purchased on a cost-to-own basis,” he says, “and if you can get the cost of fuel down, as natural gas has the possibility of doing, it’s going to be pretty successful with fleet customers.”

For regular consumers there is a classic chicken and egg problem. Out on the road, there just aren’t a lot of places where you can get compressed natural gas.

“Because before you will spend the money to put in the [CNG] infrastructure, you want to know that you’re going to be able to sell enough [CNG] to enough vehicles to pay the bill,” says Hoffmeister.

But Hoffmeister says a popular vehicle like the F-150 taking natural gas could help spark the building of the missing infrastructure.

Environmentalists though aren’t on board with using natural gas because of the controversial way much of the gas is extracted — through hydraulic fracturing or “fracking.”

Roland Hwang with the Natural Resources Defense Council says he’s not opposed to the fuel, but he doesn’t like how the U.S. is getting it.

“When you look at that F-150 or whatever vehicle in the showroom, you’re thinking about whether [it] is a good choice for the environment,” Hwang says. “You got to keep in mind and you got to ask the question [of] how this fuel is being produced. Is it better or is it just different?”

But the automakers are under pressure to increase fuel economy and it’s not that hard to adapt current engines to run on compressed natural gas. So that’s why you’ll soon be seeing them in showrooms.

But it’s not clear yet whether average consumers are ready to step up and pay thousands of dollars extra for a natural gas option. [Copyright 2013 NPR]

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