Paccar Inc.: Fuel-Sipping Big Rigs

April 19, 2006
Truck maker joins the hybrid technology blitz with a fuel-efficient medium-duty vehicle scheduled for release in 2008.

The buzz surrounding hybrid vehicle technology these days has primarily been focused on cars and sport utility vehicles. But big-rig builder Paccar Inc., Bellevue, Wash., will also utilize hybrid technology to reach its goal of 30% fuel-efficiency improvement for medium-duty trucks over the next seven years.

Paccar, one of IndustryWeek's IW Best 50 Manufacturers for 2005, is working with Eaton Corp.'s Hybrid Power Systems business unit to deliver hybrid-powered trucks by 2008.The hybrid systems comprise an electric motor generator and an onboard energy storage system. Power from the engine is used to drive the vehicle directly or to charge the storage device. These systems are designed to provide maximum fuel savings in applications where frequent braking and acceleration is required, including local delivery and vocational operations. The hydro-powered trucks should also require less maintenance because of reduced wear on the braking system, the company says.

"Paccar's comprehensive global hybrid program is aimed at commercializing energy-management systems that provide benefits to both our customers and the environment," said company Chairman and CEO Mark Pigott in a March 31 statement.

Paccar Inc.
At A Glance

Paccar Inc.
Bellevue, Wash.
Primary Industry: Motor Vehicles
Number of employees: 20,500
2004 In Review
Revenue: $11.4 billion
Profit Margin: 8.0%
Sales Turnover: 0.9
Inventory Turnover: 22.3
Revenue Growth: 39.1%
Return On Assets: 9.1%
Return On Equity: 27.9%
The hybrid systems save fuel in trucking applications by storing energy while the vehicle is stationary. "Paccar's innovative onboard energy-management systems will reduce vehicle idling time to further enhance operating efficiency and contribute to achieving [the] customer's fuel-economy objectives," said Paccar President Tom Plimpton in the March statement. "The Kenworth Clean Power and Peterbilt Comfort Class systems . . . maintain the vehicle's cabin temperatures at comfortable levels and provide power to operate other cab electrical systems without running the engine."

With this system, truck owners can achieve approximately 8% fuel savings worth "several thousand dollars per vehicle each year," Plimpton notes.

Paccar's ongoing efforts to reduce fuel consumption earned the company a 2004 National Medal of Technology award. President Bush presented the award to Paccar during a Feb. 13 ceremony.

"Paccar is entering its 101st year, and the National Medal of Technology provides a wonderful springboard to accelerate the company's new aerodynamic product introductions, including our active hybrid vehicle programs and industry-leading, environmentally friendly Clean Power onboard energy management systems," said Pigott after receiving the award.

Pigott credits such innovation as a driving force behind a record-setting 2005. Revenues for the year increased 23% from $11.4 billion in 2004, and profits increased to $1.13 billion from $906.8 million in 2004.

"Paccar's profitability has enabled it to systematically increase its technology investment in all facets of the business, including product design and development, customer sales, supply-chain management, manufacturing and assembly, finance, leasing and aftermarket support programs," said Pigott in the company's Jan. 31 earnings statement. "These investments have kept Paccar well ahead of the competition and have highlighted Paccar as a strong-growth company in several industry segments: capital goods, financial services and logistics."

In other recent news, by the end of 2007 Paccar said it will add 600 workers and invest $3.8 million in on-the-job training at its Montreal facility where the company makes heavy- and medium-duty Kenworth and Peterbilt trucks according to a March 25 story in Montreal's The Gazette newspaper. The company will increase production to 71 trucks per day from 64 and will invest more than $10 million by 2008 to improve installations, equipment and procedures, The Gazette reported.

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About the Author

Jonathan Katz | Former Managing Editor

Former Managing Editor Jon Katz covered leadership and strategy, tackling subjects such as lean manufacturing leadership, strategy development and deployment, corporate culture, corporate social responsibility, and growth strategies. As well, he provided news and analysis of successful companies in the chemical and energy industries, including oil and gas, renewable and alternative.

Jon worked as an intern for IndustryWeek before serving as a reporter for The Morning Journal and then as an associate editor for Penton Media’s Supply Chain Technology News.

Jon received his bachelor’s degree in Journalism from Kent State University and is a die-hard Cleveland sports fan.

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