|Fiat sees natural gas as ideal fuel for cars|
Published: December 20, 2010 3:00 a.m.
Tommaso Ebhardt and Tim Higgins | Bloomberg News
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Fiat CEO Sergio Marchionne believes natural gas engines are environmentally superior to battery-powered vehicles and are more feasible.
MILAN, Italy – As Sergio Marchionne brings back Fiat to the United States after nearly three decades, he may add another Italian speciality: the natural gas engine.
Marchionne, chief executive officer of Fiat and Chrysler Group, 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 and Toyota 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 United States 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.”
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 region.”
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 is currently the only automaker selling cars with compressed natural gas engines to U.S. retail customers.
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, and 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.