The High Cost of High Mileage

The other day I attended a presentation by Jim Hebe, the Senior Vice President of North American Sales for Navistar, Inc., about International Truck's decision to buck the industry trend and avoid using a Selective Catalytic Reduction (SCR) aftertreatment system in its 2010 heavy-duty diesel engines. New diesel emissions standards from the Environmental Protection Agency (EPA) for 2010 have pushed most diesel engine manufacturers to adopt SCR systems for their new engines, so International's stand is bold and somewhat risky. Hebe knew that, and to his credit, he didn't shy away from it. What surprised me the most about his presentation was that he directly confronted the now-famous SCR benefit of improved fuel economy. Hebe said that the added cost of urea, or Diesel Emission Fluid (DEF), the essential ingredient of an SCR system, would wipe out any savings from increased fuel economy. Fleets running 2010 trucks with SCR would save 1.2 cents per mile in reduced fuel consumtion, he said, but using DEF would add three cents per mile in operating costs. "The initial cost," Hebe said, "never goes away." At this point it's hard to know what to believe. In the last go-around of diesel emissions standards, Caterpillar famously went its own way, and today that company is out of the on-highway diesel business for good. Now International is charting its own contrary course; will it suffer the same fate as Caterpillar?