Dealers snap up natural gas pickups
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DETROIT -- Some auto dealers are eagerly ordering new natural gas-powered pickups for individual and fleet buyers amid low prices for the fuel.
General Motors and Chrysler Group recently began producing medium-duty pickups that run on compressed natural gas. When they begin arriving in dealerships before year end, the Ram 2500, Chevy Silverado 2500 and GMC Sierra 2500 will join the Honda Civic CNG as the only CNG-fueled vehicles being sold to U.S. retail buyers.
GM and Chrysler are betting that the glut of natural gas that has driven down U.S. prices will draw pickup buyers despite heftier price tags for the CNG models. They're hoping to quell range concerns by offering pickups that can run on either natural gas or regular gasoline.
"We've had a number of retail customers inquiring," says Marc Heitz, owner of Marc Heitz Chevrolet in Norman, Okla.
The bi-fuel Silverado 2500, which is sold only as an extended cab, stickers for $43,325, including shipping, or $11,000 more than the base model. The pickup starts in gasoline mode, powered by a 6.0-liter V-8 engine. It switches to natural gas once the engine reaches a certain temperature. GM predicts a 650-mile range between fill-ups.
Before, buyers who wanted CNG pickups had to have upfitters convert them. GM offered CNG vehicles to fleet customers for a decade before phasing them out in 2006.
Chrysler's Ram 2500 CNG pickup starts at $47,500, including shipping. It is designed to travel 255 miles on natural gas power before switching over to a conventional 5.7-liter Hemi V-8, fed by an 8-gallon gasoline tank. The gasoline mode extends the range by 112 miles, to 367 miles.
On its F-Series Super Duty pickups and chassis cabs, Ford Motor Co. offers an engine with a prep kit for conversion to natural gas. Customers can work with one of 10 third-party upfitters to modify the pickup for CNG, giving them choice of tank size and placement. Ford warranties conversions done by the designated installers, a spokesman says.
Heitz says he expects interest from small-business owners who work in Oklahoma's oil and gas industry. He expects to sell "a couple hundred" of the pickups to retail and fleet customers over the next year.
The high price of CNG-powered pickups could keep a lid on sales, especially for retail customers, says Eric Fedewa, a powertrain analyst at IHS Automotive. But the anticipation of a long period of low natural gas prices is driving automakers to chase incremental sales, he says.
"They're at the beginning of the growth curve," Fedewa says. "I think you'll see other manufacturers bring out low-volume programs, especially in light trucks."
Michael Jones, a product manager in GM's fleet and commercial division, says he expects stronger sales in markets where there is a decent availability of CNG fueling stations -- generally used today by commercial medium- and heavy-duty trucks -- such as Oklahoma, Utah and parts of California.
Tom Durant, whose Classic Chevrolet near Dallas is among the nation's highest-volume pickup retailers, says he's "not expecting terribly big demand" for the new CNG truck at first. But he's taking orders.
"We figured we might as well go ahead and get started," Durant says. "It'll get bigger over time."
You can reach Mike Colias at mcolias@crain.com.
