Navistar International Corp. is set to announce “operational changes” during an investor webinar on Friday morning (July 6) amid multiple reports the company will be ditching its advanced exhaust-gas recirculation (EGR) technology for meeting EPA 2010 emissions requirements. The announcement was made in a filing with the Securities and Exchange Commission (SEC) on Monday, Fleet Owner magazine reported.
“Navistar International Corp. (the “company”) announced today that it will present a live webcast on Friday, July 6, to provide an update to various operational matters related to the company,” the announcement said. Speakers will include Daniel C. Ustian, chairman, president and CEO, A. J. Cederoth, executive vice president & CFO, and other company leaders, it said.
The announcement preceded by mere hours a report in the Wall Street Journal that said the company planned to announce it is switching its emissions technology to selective catalytic reduction (SCR) to meet EPA 2010. This report followed one from Friday afternoon that said the company is considering purchasing engines from Cummins, which uses SCR.
Steve Schrier, manager-corporate communications, did not confirm nor deny the Wall Street Journal report in response to Fleet Owner questions, but did note the Friday webinar would address “various operational matters.”
Navistar is the parent company of RV maker Monaco RV LLC, which uses the EGR technology in its diesel-powered motorhomes.
Navistar’s most recent financials showed an unexpected $172 million loss in the second quarter, including significant costs related to warranty claims. Since then, the company stock has fallen 28%.
Following the earnings announcement, the U.S. Court of Appeals for the District of Columbia Circuit ruled in favor of Navistar competitors, including Cummins Inc.; Daimler Trucks North America and its subsidiary Detroit Diesel; and by sister OEMs Mack Trucks and Volvo Trucks North America, in a suit against the EPA. The EPA allowed Navistar to pay non-conformance penalties (NCPs) on diesel engines that did not meet the 0.20 grams of NOx 2010 standards. EPA fast-tracked the interim rule to authorize penalties, bypassing traditional regulatory process, the suit claimed. EPA agreed with Navistar that if EPA did not let it pay NCPs, it would have to end production of its Class 8 engines and trucks.
“In January 2012, EPA promulgated an interim final rule (IFR) to permit manufacturers of heavy-duty diesel engines to pay nonconformance penalties (NCPs) in exchange for the right to sell noncompliant engines,” stated circuit Judge Janice Rogers Brown in her written opinion.
“EPA took this action without providing formal notice or an opportunity for comment, invoking the ‘good cause’ exception provided in the Administrative Procedure Act (APA),” Judge Brown continued. “Because we find that none of the statutory criteria for ‘good cause’ are satisfied, we vacate the IFR.”
Navistar submitted its 13L engine to EPA for 2010 approval at the 0.20 grams of NOx level earlier this year, but no formal announcement regarding the progress of that has been made.
On June 29, the Chicago Daily Herald reported on a report from OTR Global that said that Navistar may offer Cummins engines, possibly as early as 2013. Karen Denning, a Navistar spokeswoman, told the Daily Herald the company doesn’t respond to “rumor and speculation.”
The report did not specify whether the Cummins engines would be sold alongside Navistar engines or in place of Navistar engines.
Editor’s Note: Monaco RV LLC President Kay Toolson and Navistar North American Truck Group President Jack Allen have issued a response to a pro-SCR letter distributed last week by several motorhome builders utilizing Freightliner Custom Chassis Corp. diesel chassis. Both SCR, which Freightliner employs, and EGR diesel-powered platforms, which Navistar has developed, are a technological response to the Environmental Protection Agency’s more stringent 2010 diesel emissions standards. Their letter follows.
THE BEST 2010 EMISSIONS SOLUTION IS ADVANCED EGR
To all Recreation Vehicle dealers (US and Canada):
Why are so many RV manufacturers pointing at Monaco RV? Think they are worried? They should be! EGR is a proven technology and the latest advancement in emissions control for the next generation of diesel engines. SCR is not.
We were shocked and disappointed by an open letter that was recently signed by seven RV manufacturers, claiming SCR as the best 2010 emissions solution for customers. We disagree. Advanced EGR is the best solution for customers because it is as simple as turning the key. At Monaco RV, we’ve never been about following the crowd – we build products based on what’s right for our customers.
In their letter, there are claims that are either outright lies or don’t make sense.
- Exhaust Gas Recirculation (EGR) is a proven technology that has been in use for years. NavistaEGR to the next level. It is a simple, no‐hassle solution.
- Navistar has delivered over 20,000 Advanced EGR‐equipped vehicles, including Monaco RVs.
EGR is Simple
- Advanced EGR doesn’t require additional components or complexity to operate a motorhome. Our customers won’t need to change anything about the way they go RVing.
- EGR doesn’t require “DEF” (urea) to run.
- MaxxForce engines in Monaco RV products are fuel‐efficient, quiet and powerful. Their letter claims that SCR elivers better fuel economy. Compared to what? Themselves?
The only thing the group’s SCR letter was right about is that Monaco RV is the only manufacturer to offer its customers Maxxforce Advanced EGR in an integrated coach product. Which makes you wonder: Why would seven manufacturers feel the need to write an open letter making a case for SCR? What are they worried about?
The answer to this question is anyone’s guess. But we can tell you why we chose the Advanced EGR solution. It’s simple: It reduces NOx inside the engine and it requires absolutely no changes to the way our customers go RVing. In other words, we put the customers first by utilizing a technological solution that is right for their needs.
And while we’re on the subject, here are some things you may want to consider about SCR and the required Diesel Exhaust Fluid (DEF):
- Running out of DEF causes the engine to derate and eventually shut down.
- At low RPM levels, such as at idle, SCR doesn’t work, creating higher, pre2007standard level emissions. Think about coach owners sitting in campgrounds or in traffic. This is a step backward for clean air.
- DEF freezes at 12 degrees F and storage isn’t recommended above 77 degrees F.
- DEF (urea) is a hazardous chemical.
- DEF and related components add to the complexity and cost of operating motorhomes.
Don’t believe us? Read the engine OEM owners’ manuals for details.
We ask that you experience for yourself the next generation of engine and RV technology by visiting our display at the upcoming RVIA show (booth #3200) and get more details at our website: www.monacorv.com/2010Emissions.
Kay Toolson, President, Monaco RV, LLC Jack Allen, President, Navistar North American Truck Group
Editor’s Note: The following “talking points” were distributed on behalf of Daimler Trucks North America following a workshop held earlier this week in El Monte, Calif., on the topic of selective catalytic reduction (SCR).
We thought you might appreciate a little balance and perspective on behalf of SCR stakeholders and the rest of the trucking industry right about now. Below, please find Daimler statements about recent Navistar studies and issues as well as Volvo’s published statements. These points might help in preparing insightful, more accurate and balanced reports on SCR technology which meets all federal and state 2010 emissions criteria and is in full production and in the field. As you will see, the comments below relate to flaws in the studies and issues advanced this week by Navistar.
Daimler Trucks North America (DTNA) Statement re: Navistar Studies on SCR distributed July 19 on fluid efficiency and July 20 on emissions.
The credibility or validity of the test published by Navistar cannot be judged without revelation of more details. We run stringent fuel economy tests at Daimler Trucks North America (DTNA) which are both accurate and substantiated. We test back-to-back componentry which is comparable from both a truck and an engine perspective. Ratings, displacements, truck configuration and more are matched to achieve valid results. The combination chosen by our competitor does not comply with these basic premises for proper engineering work and thus doesn’t provide a trustworthy result.
The 440-mile test run by our competitor is not appropriate for testing modern EPA 2010-compliant trucks. Running such a short distance test tampers with the outcome by calibrating regeneration intervals to occur immediately before and immediately after the test is completed. DTNA’s BlueTec Detroit Diesel engines regenerate after thousands of miles, not hundreds of miles. The longer the test, the more realistic the results and the closer they are to what a customer would experience in real world operations. DTNA has built more than 3,000 EPA 2010-compliant Cascadias with DD15 engines and more than 2,000 full production vehicles are currently running every day in customer fleets. Numerous customers running real life tests had completely different results and they have found Freightliner to be the best solution.
In order to get a truly accurate and reliable comparison between vehicles, the use of comparable products with equivalent drivetrain components is a must. We’re eagerly anticipating acquiring an EPA 2010 certified series production 12.4L MaxxForce engine in order to run our own comparison study.
In the end, customers have voted loud and clear for Daimler’s BlueTec solution. Daimler Trucks North America has logged more than 25,000 EPA 2010 SCR-equipped orders. We are unaware of any announcements made by Navistar on their sales track record in this category to-date.
It is neither appropriate nor credible to compare the 12.4L MaxxForce “mystery” engine with proven technology available in the market. A statement by JPMorgan issued just yesterday in an investor guidance statement picked up on public websites effectively refutes Navistar inferences from the study. In it, JPMorgan clearly articulates “the apples-and-oranges flaw in the comparison and questions Navistar’s intent in commissioning the study.” We agree with that statement.
Daimler Trucks North America offers the following information re: the EPA/CARB Workshop.
- Members of the Daimler Trucks North America (DTNA) regulatory and engineering teams attended the workshop co-hosted by the Environmental Protection Agency and the California Air Resources Board.
- Data collected by DTNA and reported to agencies for compliance certification of its Detroit Diesel engines with BlueTec emissions systems comes after completion of more than 30 million test miles, including several million customer freight hauling miles in DTNA EPA2010 trucks.
- DTNA’s EPA2010 trucks have been built on the assembly line in full production mode since the beginning of 2010 and, to date, Freightliner has built more than 3,000 EPA2010-compliant Cascadias with DD15 engines. Over 2,000 DTNA EPA2010-compliant trucks are running in customer fleets already, with customer orders for more than 25,000 EPA10 vehicles to date, including 16,565 Freightliner-brand trucks.
- DTNA’s BlueTec emissions systems operate as designed, meeting federal and state air quality standards that reduce particulate matter and nitrogen oxides to near-zero levels without the use of credits.
- DTNA testing and customer experiences also validate that DEF refilling inducements work to consistently and effectively keep each DTNA vehicle operating in compliance with 2010 emissions standards.
- The company will not comment on technologies manufactured or actions taken by other companies.
Meanwhile, Volvo Group defends SCR at environmental workshop – Truck News – 7-22-10
EL MONTE, Cal. — Representatives from Volvo Group attended a recent workshop with environmental regulators, initiated by Navistar to raise concerns about selective catalytic reduction (SCR).
The company strongly defended the effectiveness of SCR and warned against revamping the regulations with the roll-out of EPA2010-compliant engines already well underway.
“We question the need to make modifications to SCR strategies just six months after SCR products were brought to market,” said Steve Berry, director of government relations with Volvo Powertrain. “These strategies were thoughtfully developed in good faith by EPA, CARB and EMA, applying their collective best judgment to balance SCR operation with other critical issues, not the least of which is safety.”
Volvo raised the point that unjustifiably limiting engine torque excessively could cause safety concerns on the road or strand drivers in the middle of nowhere in adverse conditions.
Berry went on to say “We have seen no evidence of DEF refill or SCR tampering issues in the field and believe it is premature to impose new restrictions in the absence of any evidence of need.”
John Mies, vice president, corporate communications with Mack and Volvo called out Navistar.
“The fact is that a Mack or Volvo truck running at 0.2 grams (per brake hp/hr NOx) is and will continue to be much better for the environment than a Navistar truck running at 0.5 grams – and no amount of changes to the inducement strategies will change that,” he said. “Let’s make sure that what we do is truly in the interest of the environment and the public. And let’s not penalize those who have worked with you in good faith, and reward those who are trying to manipulate the system for their own competitive advantage.”
Volvo Group has already delivered more than 3,500 Volvo and Mack engines with SCR in North America and has received orders for more than 10,000.