Along with the growth of natural gas as a fuel for commercial vehicles comes opportunities for those involved in the parts and service industries.

A golden business opportunity not to be missed

Oct. 11, 2013
Is your business prepared for the coming energy boom?

We hear and read a lot of conflicting information on energy for the future and how our current fuels are nearing the end of their cycles. I'm not sure too many of us actually believe that unless we are in the business of making biofuel, solar, geothermal or wind power.

The current intensity for promoting alternative fuels and power has changed from just a few years ago. At that time, we were expecting we'd all soon be running cars and trucks on biofuels, battery power and some natural gas. Power generation via wind farms and solar arrays were the conventional wisdom on the power of the future.

But as Chief Inspector Clouseau would say: "Not anymore."

Dominant Fuel

A few billion cubic yards of new natural gas deposits were discovered spread out across the country. That drove a Gold Rush type movement on finding more of this clean-burning, very low-cost fuel.

Pretty soon, we were looking at the potential for natural gas reserves that would supply industry and transportation for the next 50 to 100 years. Fracking and other technologies significantly compounded the new, available reserves.

Without multi-billion dollar government incentives or advertising and promotional campaigns, natural gas is becoming the dominant fuel within the power generation business, supplanting coal. Why? Because natural gas is cheap, hugely available in massive quantities and primarily domestic supplied.  

We are now standing on a threshold that could lead to a significant percentage of future on-highway commercial vehicles running on natural gas. The present challenge is related to the natural gas industry's ability to rapidly develop an infrastructure capable of reaching the fueling locations for commercial vehicles.

Barriers To Adoption

Some view that as a chief, nearly insurmountable, hurdle. But when you speak with the companies involved in production, distribution and de, the evidence is far too convincing to ignore. There are natural gas powertrain development programs going on all over the world. Much of what is being developed already has millions of miles of testing. Once all of these systems are in place as production products, you will see them hitting the market with outstanding economics.

Parts and Service Opportunities

So what does this mean to you as a parts and service professional or fleet operator? Think about hundreds of thousands of miles of pipeline construction for natural gas feed lines, plus thousands of fueling locations and storage facilities. Very little of this is going to be done without a lot of truck transportation and construction will be demanding for these new vehicles.

Consequently, there will be a need for massive amounts of parts and vehicle service, tools and shop equipment, and new vehicles and equipment. Most of the construction will take place with non-local fleets.

If you run shop operations, you will need to make safety upgrades to handle the new types of vehicles and your parts inventories will need to accommodate new products.

A good example and model for this is taking place in North Dakota and Montana with the Bakken oil and gas fields. No one is sitting around up there waiting for the next customer to come in. All businesses are running 24-7, all year long, scrambling for people to work for them. Unemployment is in the 4 percent range. 

Prepare Now

Make the time now to prepare for what is coming if your business covers any of the areas where all of this activity will likely take place, and that is nearly in every part of the country. Do not miss out on the golden opportunity to take part in a boom economy, however micro it may appear.

Every aspect of this type of operation may require you to look at new ground in terms of the products or services you provide. It may require possible expansion into other developing markets.  

Having looked at this part of the industry for the past few years, many of us see its trajectory as fairly steep and long-term. Although natural gas is viewed as one of the major fuels of the future, diesel will still dominate for decades to come. Nevertheless, this type of opportunity doesn't come along too many times in one's business lifetime. 

Make sure you are planning for the expansion of natural gas as a vehicle fuel. Learn as much as you can so that you'll be abler make the right decisions for your own business.

About the Author

Tim Kraus

Tim Kraus is the president and chief operating officer (COO) of the Heavy Duty Manufacturers Association (HDMA). www.hdma.org. Prior to joining HDMA, he served in various executive positions with heavy duty industry parts manufacturers. HDMA exclusively serves as the industry voice of the commercial vehicle product manufacturers. It is a market segment affiliate of the Motor & Equipment Manufacturers Association (MEMA). www.mema.org.

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