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PACCAR Inc. Message Board

  • slavoy01 slavoy01 Jan 29, 2013 1:15 PM Flag

    EPA Regulations not good for PCAR

    A recent article in Land Line magazine outlines new EPA regulations. The first round of regulations apply to trucks manufactured in years 2014 to 2017. In this period EPA has mandated a 20% reduction in greenhouse gases. Most of this reduction will be achieved through improved truck fuel economy. This sounds great on the surface, but a closer look reveals this could push the average price of a class 8 truck up to $200,000.

    Truck prices at these levels will encourage truck owners to fix up and try to extend the life of current fleets. It may also encourage a buying surge this year prior to new regulations phasing in. Next year new truck sales may be flat as truck owners try to run with the trucks they have.

    Another round of regulations is set to start in 2018. Long term, this means higher costs for the trucking industry and ultimately higher consumer prices.

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    • Good heads-up, thx. Could be a reason behind our sustained run-up and hold of stock price. Though analyst #'s aren't changing for 1/31 release, the typical "meets earnings" hang-over mini-correction will be interesting to see if repeated.

      • 1 Reply to rckrymnd
      • I think we will see a compromise where a portion of "reduced" GHG emissions are achieved through increased allowed payload on Interstates - there are forces at work here that may not be directly apparent. There has been resistance from unions to increased payloads so this would be a backdoor way to achieve increased payloads since the environment, not profits, is the only way to trump the unions. A 15 percent payload bump with 5 percent worse fuel economy is still a reduction in GHG per ton of freight/mile. This reduces congestion, impact of driver shortage and cost/ton/mile. Of course increased payloads means fewer trucks needed to move the same amount of goods, but it also means better trucks - likely compromise is only new trucks would be authorized to carry the increased payload, offsetting the added cost of EPA's GHG14. There is some low hanging fruit - aggressive use of idle shut down, low resistance tires, aero tweaks - they can meet the requirements with no need for significant technology - incremental changes will work. The requirements phase in over 2014-2017 so I don't expect a big push for pre-buy. And the improvements in fuel economy should reduce impact of higher costs.
        All jmho, JLT

    • mrmosebt1 Jan 29, 2013 4:51 PM Flag

      how has the e.p.a. targeted pcar any differently than any other ? i believe this claim is false. i think it is as false as the reasons given for bush's wars. the question is "why lie"?

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