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Proprietary and Confidential | Chris Nordh – Director, Advanced Fuels & Strategic Infrastructure The Game Changer in Transportation 1.

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Presentation on theme: "Proprietary and Confidential | Chris Nordh – Director, Advanced Fuels & Strategic Infrastructure The Game Changer in Transportation 1."— Presentation transcript:

1 Proprietary and Confidential | Chris Nordh – Director, Advanced Fuels & Strategic Infrastructure The Game Changer in Transportation 1

2 Proprietary and Confidential | Ryder Corporate Overview Company Overview: Fortune 500 Ranking – 404 Total Revenue $6.2 Billion US Locations On-Site Total Employees 29,400 Total Units Under Contract 150,000 Total Units 200,000 + Global Reach Provider : Fleet Management Solutions Leasing Truck Rentals Used Vehicle Sales Maintenance Fuel Safety Services Dedicated Vehicles Drivers Routing Scheduling Supply Chain Management Acquisition of Raw Materials to Delivery of Finished Products

3 Proprietary and Confidential | 3 Ryder natural gas fleet innovation program Investing in Natural Gas since 2009 Deep knowledge base ► 500+ NG Tractors/Trucks 6.14 ► 20,000,000 miles run on NG ► Fuel station networks, design and layout ► Natural Gas engine technology ► Facility design and layout ► Facility modifications required to maintain compliance to NFPA codes Customer access to fleet innovation: ► Latest natural gas fleet technology ► CNG & LNG fueling infrastructure ► Maintenance & roadside services ► Safety and technical expertise ► Sub vehicles

4 Proprietary and Confidential | 4 Not the first time we try natural gas!

5 Proprietary and Confidential | 5 This time is different!

6 Proprietary and Confidential | 6 US behind the rest of the world in NGV use

7 Proprietary and Confidential | 7 However… When we decide to do something, we become #1 ► We have access to capital ► Entrepreneurial spirit ► Most capable engineering minds ► Government support… Will lead to jobs, exports & growth

8 Proprietary and Confidential | 8 Made in America Nat Gas Engines & Technology ► Cummins Westport ► Westport ► GM Compressors ► GE ► ANGI ► IMW Tanks & Systems ► Quantum ► 3M ► Chart ► Agility

9 Proprietary and Confidential | 9 Complexity Diesel vs. NG CNG vs. LNG Where to Fuel Time per Fueling Frequency of Fueling Range vs. Weight vs. Cost Uptime of Equipment Driver Hours Lease vs. Own Where to Maintain Total Cost of Ownership (TCO)

10 Proprietary and Confidential | 10 Vehicle Trials – What to Expect Validate Vehicle Performance ► Engine capabilities ► Vehicle reliability ► Driver acceptance Validate Existing Fueling Stations ► Fuel fill time ► Station accessibility Financial Results ► Will not reflect economies of scale Leverage buying power at retail stations Leverage fuel volume for 3 rd party station builder Ryder Rental Trials 12L ISX-G Michigan Texas Georgia Louisiana California Utah Arizona

11 Proprietary and Confidential | 11 Larger Implementation Strategy Leverage Economies of Scale ► Create plan & TCO budget to buy/lease/convert enough vehicles to generate single location volumes in the 200,000 – 500,000 DGEs per years. New dedicated NG equipment is most advantageous  OEM with new engines Glider kits with remanufactured engines  Dual fuel technology – verdict still out but positive feedback ► Back into the required fuel cost that provides required ROI ► Identify location for station that minimizes operational impact ► Create partnership with a fuel station builder ► Hedge your bets = Game changer! ► Execute vehicle implementation based on timeline for station completion

12 Proprietary and Confidential | 12 How is Ryder helping offset Increased costs? Buying tank systems directly from tank manufacturer ► Quantum technologies Installing tank systems ourselves ► Reduces install cost ► Reduces transportation cost ► Reduced vehicle lead time Increased residual values ► 12L with medium sized tank systems (115DGE – 140DGE) Create the right scale of implementation ► Leverage multiple customers into a single fuel station

13 Proprietary and Confidential | 13 Quantum 123DGE Back of Cab CNG tank system

14 Proprietary and Confidential | 14 Regulatory Environment Usually not a positive! ► EPA 2007 ► EPA 2010 ► EPA 2013/14 Obama recently told EPA and DOT to create & issue new fuel efficiency and GHG standards for trucks by March 2016 – effective 2020 Diesel operations will continue to get more expensive, as natural gas operation will continue to get cheaper to buy & operate

15 Proprietary and Confidential | 15 Conclusions Given the right scale, natural gas applications make financial sense today, without incentives. Infrastructure players will build stations anywhere you want, given base load volumes. Comparative costs will continue to improve Industry has a solid base for continued success and expansion

16 Q&A

17 Proprietary and Confidential | 17 Maintenance Considerations Shop upgrade costs - $300,000 - $500,000 per shop ► NFPA vs. Fire Marshall Technician Training & Tooling $30,000 - $80,000 Vehicle premium ► CNG vs. LNG ► Range vs. Weight vs. Cost Maintenance Cost Increase!!! ► Expensive Spark Plugs ► Tank inspections / vacuum seal ► Component failures ► Fuel system complexity ► Increased Inventory

18 Proprietary and Confidential | 18 On & Off Road, Marine & Rail CR England just signed on with Shell for LNG stations Alpha Coal West (off road) are doing dual fuel vehicle applications Marine leapfrogging from bunker fuel to LNG ► Golf Coast Shipping (Gulfport, MS) just launched 1 st of 6 302’ long LNG dual fuel vessels. Railroad industry evaluating CNG & LNG, Dedicated & Dual Fuel ► Indiana Harbor Belt Railroad to convert 31 locomotives to CNG ► Berkshire Hathaway testing these technologies in a number of their railway companies

19 Proprietary and Confidential | 19 Shop Retrofit Considerations Methane Detection ► Ryder requires for both CNG & LNG Electrical ► Relocate electrical outside classified zone (18”) ► Explosion proof lighting Facility Heaters ► No ambient heaters because they get to 900 degrees ► Forced air Adjacent Occupancies ► Install audible & visual alarms

20 Proprietary and Confidential | Shop Retrofit (continued)

21 Proprietary and Confidential | Shop Retrofit (continued)

22 Proprietary and Confidential | Natural Gas Vehicle Running Costs NGV Running Cost Analysis ► Data set = 170 Tandem Axle NGVs ► Freightliner M2-112 Chassis ► Cummins 8.9L ISL-G ► CNG and LNG configurations

23 Proprietary and Confidential | Natural Gas Vehicle Running Costs (continued) DATA SET ► 170 NGVs and 1,811 Diesels ► 2010 EPA Diesel models ► 4,000 – 6,500 miles per month ► All Freightliners 34 Month Cumulative Comp ► $3,370 Cumulative increased RC ► ~$99 / month ► ~1.9c / mile

24 Proprietary and Confidential | Maintenance - 8.9L Cummins ISL-G Failures due to installation & handling procedures ► Premature spark plug failures ► Handling & Installation of spark plug ► Boot & Plug ► Separate install wrench & torque spec ► Coil pack cracking ► Installation process ► Overhead set ► Outside tolerance spec Known Issues ► Manifolds ► Pistons ► Turbos

25 Proprietary and Confidential | Silk Glove Maintenance! Torque value: 38 Nm = 28 ft-lbs

26 Proprietary and Confidential | Original ISL G Exhaust Manifold 26 4 port and 2 port Design Current Symmetrical Exhaust Manifold 3 port and 3 Port Design

27 Proprietary and Confidential | Fuel System – Lessons learned


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