To stay square with the EPA, makers of big diesel engines have found new ways to curb the clouds of noxious diesel exhaust. But the low-emissions engines carry a high price.
It may be small comfort as you sit stalled behind an 18-wheeler in traffic, sucking soot down into your lungs from the clouds of diesel exhaust. But our air's actually getting cleaner all the time. Makers of big diesel engines have tinkered furiously with their products in the past few years to bring them into compliance with the first phase of the EPA's tough anti-pollution rules. And they've made real strides in getting the lead—or more precisely, the nitrogen oxide and particulates—out; nitrogen oxide alone is expected to be down a third from 1998 levels by the end of this year. Now they're gearing up to meet the next phase of the agency's aggressive timetable. With luck, Americans everywhere will be inhaling far fewer particulates and a lot less nitrogen oxide (NOx) by 2010.
But there's a price to pay for cleaning up this act. The new low-emissions engines introduced in October 2002 cost more than their predecessors—anywhere from $2,500 to $4,000 more per unit, according to Fleet Owner magazine. They also burn fuel more freely. And those are just the quantifiable concerns. What's really giving fleet operators the chills are the unknowns: Will the new engines need more frequent maintenance? Will they stand up to the day-in/day-out demands of real-world hauling conditions? Will they last as long as the older, non-compliant models?
The engine manufacturers themselves are unhappy about the uncertainties, but they point out that they've had to meet what they consider a tough set of standards in a very short time. The first phase of the EPA's rules, which called for lowering both NOx and particulates (soot), were originally set to take effect in 2004. But as part of a $1 billion 1998 settlement arising from an EPA "enforcement action" against engine makers for alleged testing irregularities, "several engine manufacturers had to sign a consent decree with the EPA to move the standards ahead to 2002," explains Bill Gouse, vice president of engineering at the American Trucking Associations (ATA), based in Alexandria, Va.
Moving up the deadline meant scaling down the testing. And that's what worries truckers."While we supported the 2004 standard," says Gouse,"we weren't able to test the product as we would have liked in time for the 2002 pull ahead, so there were a lot of concerns about the new engines." Adds Tom Freiwald, senior vice president of marketing for Detroit Diesel, "We worked closely with the EPA and we wanted the new engine introduction process to go as smoothly as possible. But the truck manufacturers and their customers would have preferred to test the technology before it was int roduced. They usually get two years to do this, and that didn't happen this time."
Not ready for prime time?
Given the time constraints for compliance, most manufacturers opted to outfit their engines with cooled exhaust gas recirculation (EGR) hardware to cut NOx emissions. Under this system, much of the exhaust stream is recirculated, cooled and then reintroduced into the combustion chamber, where it's burned off.
The fix was quick, as fixes go, but it's also somewhat experimental. Because this technology's largely unproven, many fleet owners fear that the engines' longevity may be compromised. "We'd like to stay on the same [engine] life cycle of about 800,000 miles," says Steve Duley, vice president of purchasing for Schneider National of Green Bay, Wis."Logic would tell you that with the new technology, the new engines won't last as long, but right now it's too early to tell."
Another concern has been the amount of maintenance the low-emissions engines will require,though the manufacturers downplay this one."The standard used to be oil changes at 15,000 to 25,000 miles, although changes with our engines were typically at 35,000 miles," says Tom Kieffer, executive director of marketing at Cummins, based in Columbus, Ind. "With the new engines, we recommend changing at 25,000 miles, which is still above standard."
But Gouse says that this one's too early to call."In some of the new engines,exhaust is cycled back into the oil,so the oil must do more work," he reports. "So we really don't know yet how this will play out."
Perhaps the truckers' biggest concern has been fuel economy. The EGR technology is said to cut fuel efficiency anywhere from 3 percent all the way to 15 percent, depending on who you talk to."This is the first time we've had a reduction in fuel economy from new engines," Gouse notes.
Freiwald of Detroit Diesel counters that the engine manufacturers are continually working to improve fuel economy, and the industry can expect improvements in this area in the future. "We have to be sensitive," he says. "The fuel economy issue hasn't been as bad as people had predicted, but it is a loss." In fact, Freiwald believes that as a whole,the en gines have perform ed mu ch bet ter than pred icted . "People who tried to get the standard delayed based their arguments on the worst-case scenario," he says. "The issues were unknown then," he says, "but most of them haven't come to fruition."
Rush delivery
Those assurances apparently weren't enough for fleet operators, however. Many hastily revised their spending plans last year and pre-bought trucks equipped with engines made prior to the October 2002 deadline. Ann Arbor, Mich. -based Con-Way Transportation Services, for instance, pre-bought all of its truck needs for 2003. Con- Way,which operates three regional less-than-truckload carriers that provide service across the United States, bought 400 new trucks before the October 2002 deadline kicked in, forestalling the need to purchase any trucks in 2003. "And we're not planning on buying any in 2004 either," says Doug Stotlar, COO and executive vice president for the company. "Our concern was that when technology changes this quickly, it's not given an adequate test period."
Schneider National, based in Green Bay, Wis., also prebought tractors. "There weren't any engines available for testing to help us make a decision about the technology," says Duley. "We did our best to help delay the standard, but that didn't work."
Schneider bought about a third more trucks than it normally would have for 2003 in advance of the new standard. Since that time, the company has also purchased 50 trucks with the new engines to begin testing their performance and will start adding some of the trucks to its fleet in the coming months.
This spike in demand disrupted operations not only for the engine manufacturers, but for the truck manufacturers as well. Many had to go from one or two shifts to three on short notice in order to meet the sudden demand for vehicles equipped with the pre-standard engines.
Yet most of the engine manufacturers insist they were able to weather the pre-buy storm as well as the ensuing sales drought. "There was about a two- to three-month drop-off," admits Kieffer of Cummins, "but it wasn't as significant as had been predicted. We're at or exceeding our plan for market size at this point in the year."
Too much, too soon?
Fleets won't be able to put off equipment purchases indefinitely, however; at some point, they'll have to make the switch. And when they do, they'll have to choose between two competing technologies. Two of the Big Three engine manufacturers—Cummins and Detroit Diesel—met the 2002 EPA standard by adding EGR technology to their new engines; the third, Caterpillar, took a different route, developing advanced combustion emission reduction technology (ACERT) . But because it has only recently been able to put its ACERT technology to work in its engines, Caterpillar has had to pay fines for its out-of-compliance engines in the interim.
Yet Caterpillar dismisses the fines, which averaged $3,000 per engine, as a small price to pay for the added development time."We knew we couldn't have the ACERT technology available in time for the 2002 deadline," says spokesman Carl Volz. "But the ACERT technology is revolutionary and will certify our engines in time for the next deadline."
That will come in 2007, when the final stages of the EPA's anti-pollution mandate start to kick in. The 2007 standards, which focus on further reducing NOx and particulates, have the fleet owners seriously worried. According to Stotlar, none of the engine manufacturers has yet been able to demonstrate a clearly delineated strategy for meeting the stand a rds even though they must be ready for testing the new technology by 2004.
At this point, the industry's best hope for meeting the NOx limits appears to be installing an aftertreatment device known as an adsorber. But that won't be cheap. Stotlar of Con-Way estimates the cost of installing NOx adsorbers on engines at anywhere from $4,000 to $15,000 apiece, and he predicts another large equipment pre-buy prior to 2007. "Those buying and using the engines will have to pass that cost along to the consumer," he says."We support clean air," adds Duley of Schneider."But these standards are too much to absorb, too quickly."
A move by federal regulators to reinforce requirements for broker transparency in freight transactions is stirring debate among transportation groups, after the Federal Motor Carrier Safety Administration (FMCSA) published a “notice of proposed rulemaking” this week.
According to FMCSA, its draft rule would strive to make broker transparency more common, requiring greater sharing of the material information necessary for transportation industry parties to make informed business decisions and to support the efficient resolution of disputes.
The proposed rule titled “Transparency in Property Broker Transactions” would address what FMCSA calls the lack of access to information among shippers and motor carriers that can impact the fairness and efficiency of the transportation system, and would reframe broker transparency as a regulatory duty imposed on brokers, with the goal of deterring non-compliance. Specifically, the move would require brokers to keep electronic records, and require brokers to provide transaction records to motor carriers and shippers upon request and within 48 hours of that request.
Under federal regulatory processes, public comments on the move are due by January 21, 2025. However, transportation groups are not waiting on the sidelines to voice their opinions.
According to the Transportation Intermediaries Association (TIA), an industry group representing the third-party logistics (3PL) industry, the potential rule is “misguided overreach” that fails to address the more pressing issue of freight fraud. In TIA’s view, broker transparency regulation is “obsolete and un-American,” and has no place in today’s “highly transparent” marketplace. “This proposal represents a misguided focus on outdated and unnecessary regulations rather than tackling issues that genuinely threaten the safety and efficiency of our nation’s supply chains,” TIA said.
But trucker trade group the Owner-Operator Independent Drivers Association (OOIDA) welcomed the proposed rule, which it said would ensure that brokers finally play by the rules. “We appreciate that FMCSA incorporated input from our petition, including a requirement to make records available electronically and emphasizing that brokers have a duty to comply with regulations. As FMCSA noted, broker transparency is necessary for a fair, efficient transportation system, and is especially important to help carriers defend themselves against alleged claims on a shipment,” OOIDA President Todd Spencer said in a statement.
Additional pushback came from the Small Business in Transportation Coalition (SBTC), a network of transportation professionals in small business, which said the potential rule didn’t go far enough. “This is too little too late and is disappointing. It preserves the status quo, which caters to Big Broker & TIA. There is no question now that FMCSA has been captured by Big Broker. Truckers and carriers must now come out in droves and file comments in full force against this starting tomorrow,” SBTC executive director James Lamb said in a LinkedIn post.
The “series B” funding round was financed by an unnamed “strategic customer” as well as Teradyne Robotics Ventures, Toyota Ventures, Ranpak, Third Kind Venture Capital, One Madison Group, Hyperplane, Catapult Ventures, and others.
The fresh backing comes as Massachusetts-based Pickle reported a spate of third quarter orders, saying that six customers placed orders for over 30 production robots to deploy in the first half of 2025. The new orders include pilot conversions, existing customer expansions, and new customer adoption.
“Pickle is hitting its strides delivering innovation, development, commercial traction, and customer satisfaction. The company is building groundbreaking technology while executing on essential recurring parts of a successful business like field service and manufacturing management,” Omar Asali, Pickle board member and CEO of investor Ranpak, said in a release.
According to Pickle, its truck-unloading robot applies “Physical AI” technology to one of the most labor-intensive, physically demanding, and highest turnover work areas in logistics operations. The platform combines a powerful vision system with generative AI foundation models trained on millions of data points from real logistics and warehouse operations that enable Pickle’s robotic hardware platform to perform physical work at human-scale or better, the company says.
Bloomington, Indiana-based FTR said its Trucking Conditions Index declined in September to -2.47 from -1.39 in August as weakness in the principal freight dynamics – freight rates, utilization, and volume – offset lower fuel costs and slightly less unfavorable financing costs.
Those negative numbers are nothing new—the TCI has been positive only twice – in May and June of this year – since April 2022, but the group’s current forecast still envisions consistently positive readings through at least a two-year forecast horizon.
“Aside from a near-term boost mostly related to falling diesel prices, we have not changed our Trucking Conditions Index forecast significantly in the wake of the election,” Avery Vise, FTR’s vice president of trucking, said in a release. “The outlook continues to be more favorable for carriers than what they have experienced for well over two years. Our analysis indicates gradual but steadily rising capacity utilization leading to stronger freight rates in 2025.”
But FTR said its forecast remains unchanged. “Just like everyone else, we’ll be watching closely to see exactly what trade and other economic policies are implemented and over what time frame. Some freight disruptions are likely due to tariffs and other factors, but it is not yet clear that those actions will do more than shift the timing of activity,” Vise said.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index indicating the industry’s overall health, a positive score represents good, optimistic conditions while a negative score shows the inverse.
Specifically, the new global average robot density has reached a record 162 units per 10,000 employees in 2023, which is more than double the mark of 74 units measured seven years ago.
Broken into geographical regions, the European Union has a robot density of 219 units per 10,000 employees, an increase of 5.2%, with Germany, Sweden, Denmark and Slovenia in the global top ten. Next, North America’s robot density is 197 units per 10,000 employees – up 4.2%. And Asia has a robot density of 182 units per 10,000 persons employed in manufacturing - an increase of 7.6%. The economies of Korea, Singapore, mainland China and Japan are among the top ten most automated countries.
Broken into individual countries, the U.S. ranked in 10th place in 2023, with a robot density of 295 units. Higher up on the list, the top five are:
The Republic of Korea, with 1,012 robot units, showing a 5% increase on average each year since 2018 thanks to its strong electronics and automotive industries.
Singapore had 770 robot units, in part because it is a small country with a very low number of employees in the manufacturing industry, so it can reach a high robot density with a relatively small operational stock.
China took third place in 2023, surpassing Germany and Japan with a mark of 470 robot units as the nation has managed to double its robot density within four years.
Germany ranks fourth with 429 robot units for a 5% CAGR since 2018.
Japan is in fifth place with 419 robot units, showing growth of 7% on average each year from 2018 to 2023.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."